Everything You Ever Wanted To Know
The number of homes that America lacks ranges from 2 million to 6 million, depending on the articles you read. We all have probably have heard stories of people looking for a house and finding very little to choose from. The question is: Why?
Strangely, it has been impossible to provide a precise response to such a straightforward problem. Although there is a nationwide housing scarcity, the issue is local. Zoning regulations control the location of new construction as well as its number, kind, minimum lot size, and number of meetings required. Also, each town creates these rules independently. Some articles suggest that over 30,000 locations create zoning regulations in the United States. As a CPA, I am a fan of consistency and that is clearly what we do not have here.
You are not alone in yearning for the days when interest rates were historically low.
Freddie Mac reports that the average rate on 30-year mortgages has more than doubled this year, from approximately 3% to 6.6%. Subsequently, average monthly payments have increased by fifty percent in a short period of time.
The rate of IRS audits remains historically low. In 2019, the General Accounting Office audited 0.25% of all individual tax returns, compared to 0.900% in 2020. The frequency of letters for mismatching or return discrepancies is significantly higher. How does the IRS determine who will receive a letter or an audit?
The majority of investors own rental properties in order to generate income. They frequently provide income as long as you can keep them busy. Also, the value of the home can increase, giving you a tidy profit when you decide to sell.
But you need to know what happens when you sell a rental property before you sell the property. Understanding depreciation recapture taxes is crucial because they frequently catch investors off guard in the last minute.
A tax on the depreciation you deducted while owning the property is known as depreciation recapture tax. Uncle Sam will want a percentage of the proceeds from the sale of the property that you deducted from your income.
Alisa Cohn (@AlisaCohn) is a prominent start up coach and was a guest on a Tim Ferris podcast. She discussed and provided scrips for some of the most difficult conversations at work. I have used these and they are priceless, including two of the most difficult conversations:
Scripts for having difficult feedback conversations with employees when the first one’s been used but the situation hasn’t improved (and you’re not ready to fire them — yet).
The firing conversation script.
This month seems to be the perfect time to revisit what we know about President Biden’s tax plan. During his presidential campaign, President Biden proposed raising taxes on corporations, estates and high-income households, reversing key parts of the 2017 tax cuts passed by Republicans and reprising policies that the Obama administration couldn’t get through Congress. The likely result: up to $2 trillion worth of tax increases over the next decade.
I was recently speaking with a soon to be college graduate about the right type of job for them to pursue. I directed them to a concept Jim Collins created in his book Good to Great. The Hedgehog Concept is developed in the book Good to Great. A simple, crystalline concept that flows from deep understanding about the intersection of three circles: 1) what you are deeply passionate about, 2) what you can be the best in the world at, and 3) what best drives your economic or resource engine.