A little background. I live in CA. I have my own business which as been a sole proprietorship but I just switched it to an LLC this year. I make good money but am over extended…and have no tax write offs after divorce. My credit scores are in the 640’s I have been thinking about AITD’s here in CA to help with my taxes which I disparately need. I would like to use them as rentals. Suddenly I have a chance to pick up three separate properties…all are struggling with payments but not behind and all have higher loans than the current market values.
Questions:
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How do I get to claim the mortgage interest write-off if the 1099 goes to the person holding the loan??
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To protect both my self and the seller, how do you handle insuring that the payments are being made? I have heard in the past about third party services where I would send the money to and they in turn would make the payment to the lender. It is my understanding that they also notify the seller of any delinquencies on my part for their protection. Stating that, I have no idea of where to look for this service.
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Should I incorporate myself first and have the corporation do the AITD’s? Well this affect my ability to offset my personal taxes? This is very complicated and I am sure I am asking the wrong question…again, my main concern is the need to eliminate or reduce my personal taxes.
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Is there any special concerns here in California??
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Should I consider a land trust…any special concerns for California??
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Does anyone have an appropriate contract for both the AITD and Land Trust if used for here in CA??
Special concerns or be careful’s from all of you???
Thanks in advance
Ken
knolan805@earthlink.net