Which is better?
Let’s compare 3 different scenarios using a $1 dollar bill to make my point.
Dollar #1 – You probably know a number of people that make a lot of money on their job and probably pay more than their fair share of taxes (let’s say as an example they pay 35% to federal and 15% state taxes) so for every dollar they earn they have 50 cents to spend. How good is this dollar? A lot of hard work goes into this one, right? How much tax are you paying?
Dollar #2 – If you own desirable properties not only will the tenant help you pay down your mortgage but in addition you should be able to count on cash flow. What about all the tax benefits allowed by the IRS? Is this a better Dollar earned than from #1? Yes it is even if you have to pay some taxes because you probably did not have to work as hard for this one .Bottom line:Who helped you to reduce your debt? Right, the tenant.
Dollar #3 – Let’s say you sold your personal residence. How much capital gain did you pay on the sale if you lived in the property for 2 out of the past 5 years? In all likelihood you paid no taxes (up to $250,000 if filing single and $500,000 if married).
What about if you sold a rental property, and bought more properties by utilizing the 1031 Tax Exchange how much capital gains would you have to pay? You don’t and the taxes are deferred .
Bottom line: The dollar earned from selling a property will always be much better than the dollar earned at the work place.
So if you are ready, willing and able to jump in the “Game “there is no better time than the present to start investing or adding to your portfolio.
Lot's to think about.
Here's your first step: if you are interested in becoming an investor feel free to contact me at 402-679-3914.
It's our mission to help our clients generate wealth by Investing in Real Estate.
"Buy Today, Profit Tomorrow"
Check out my web site: http://fredtichauer.com
Anyone contemplating the purchase of a real estate investment should seek the services of an attorney or accountant.