Florida's Hurricane Season and FEMA's Hurricane Preparedness Widget

Florida's Hurricane Season

One of the biggest pains being a real estate investor in Florida is getting prepared for Hurricane Season. Due to the amount of work, we wait to the last minute before placing the hurricane shutters onto our rental property's windows.

As a result of waiting, problems are going to arise like:

 

• Going to Home Depot.
• Gathering Supplies, if available like:
  • Make sure you buy gloves PLEASE. I can't count the times we have been hurt just because we don't have gloves on.
  • Sun Block, Hats, Sunglasses, etc. Florida SUN is brutal. I find that the weather is beautiful just before the storm arrives. Sort of like "The calm before the storm."
  • Buy Wasp spray! As you are installing shutters on the second floor of your investment property you will find out why you need the spray! The EASY way or the HARD way.
  • A SPEED tool that allows you to secure the screws or wing nuts onto the shutter. You will thank me later!
  • Ladders of various sizes. Buy at least one that adjusts to 40 feet made out of fiberglass, NOT ALUMINUM. Why? Hint: High tension electrical cables.
  • Chain Saw and gas for cutting tree branches away from the property and for use after the storm.
• Waiting in long checkout lines.
• Loading tools and supplies onto your vehicle. Like getting your ladders onto the truck.
• Driving to the property! OK for local properties but what if the asset is in another county? At one point I had several properties in Sarasota, Broward, Miami Beach and Miami-Dade.
• Traffic – People getting out of the storm's path.
• Finding HELP! Try installing these shutters alone! Now try it on 15 other properties. See what I mean.

You are going to work harder than you ever did before. You' ll be so tired that you want the storm to blow away your portfolio of rental properties so you won't have to ever do this again.

At last the second, the storm veer's and never arrives.

You see how crazy it can get?

Oh, by the way, if for some reason you didn't get the shutters up on time and there is damage as a result of the storm, the insurance company will not pay. Just thought I would mention that!

FEMA Hurricane Preparedness Widget

One of the reason I was inspired to write this post, I found a little widget from FEMA that provides you information about getting prepared for the hurricane season or any other disaster. I have installed this widget on all my sites to help my readers make informed decisions. See the widget sample below.

Related Links, Blog Postings, Presentations or Articles:

• See our new Section 8 or Plan 8 Miami Florida Blog. A Section 8 or Plan 8 blog for real estate investors and tenants in Miami Florida. This blog is designed to provide content for real estate investors, landlords and potential tenants who wish to participate in the HUD program.

Written by +Bob Burns.

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Post Up! Real Estate Investor about.me/RobertKBurns Telephone #: 305-586-5280 email: sec8@planocho.com

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Rental Income and Expenses - Real Estate Tax Tips

Below you will find the IRS guidelines and different examples as they apply to rental properties.

You generally must include in your gross income all amounts you receive as rent.

Rental income is any payment you receive for the use or occupation of property.

Expenses of renting property can be deducted from your gross rental income. You generally deduct your rental expenses in the year you pay them. Publication 527, Residential Rental Property includes information on the expenses you can deduct if you rent a condominium or cooperative apartment, if you rent part of your property, or if you change your property to rental use.

When to Report Income

Report rental income on your return for the year you actually or constructively receive it, if you are a cash basis taxpayer. You are a cash basis taxpayer if you report income in the year you receive it, regardless of when it was earned. You constructively receive income when it is made available to you, for example, by being credited to your bank account.

For more information about when you constructively receive income, see Publication 538, Accounting Periods and Methods.

Advance Rent

Advance rent is any amount you receive before the period that it covers. Include advance rent in your rental income in the year you receive it regardless of the period covered or the method of accounting you use.
Example:

You sign a 10-year lease to rent your property. In the first year, you receive $5,000 for the first year's rent and $5,000 as rent for the last year of the lease. You must include $10,000 in your income in the first year.

Security Deposits

Do not include a security deposit in your income when you receive it if you plan to return it to your tenant at the end of the lease. But if you keep part or all of the security deposit during any year because your tenant does not live up to the terms of the lease, include the amount you keep in your income in that year.

If an amount called a security deposit is to be used as a final payment of rent, it is advance rent. Include it in your income when you receive it. Understand, Florida Statue states that a Security Deposit is NOT to be used for rent, but toward Performance. (Please refer to FS 83, Sec. 83-49 for further information.) You must also notify the tenant in writing within 15 days from vacating of your intentions toward the Security Deposit. Some landlords will require 2, sometimes 3 months to be applied as a Security Deposit. This avoids it being considered Rent if you were to collect them prior to the year’s end. However, if your tenant overlaps their lease into the New Year and you apply those Security Deposits toward final rent(s) then Yes, it is rental income. Understand, "IF" you apply these Security Deposits toward the rent if the tenant skips out on the lease or for whatever reason and does not pay their requirement, you will indeed have to show them as income, "MINUS" and repairs which will show as. You can deduct the cost of the repairs as a rental expense.

Expenses Paid by Tenant

If your tenant pays any of your expenses, the payments are rental income. You must include them in your income. You can deduct the expenses if they are deductible rental expenses. See Rental Expenses in Publication 527, for more information.

Example One:

Your tenant pays the water and sewage bill for your rental property and deducts it from the normal rent payment. Under the terms of the lease, your tenant does not have to pay this bill.

Example Two:

While you are out of town, the furnace in your rental property stops working. Your tenant pays for the necessary repairs and deducts the repair bill from the rent payment. Based on the facts in each example, include in your rental income both the net amount of the rent payment and the amount the tenant paid for the utility bills and the repairs. You can deduct the cost of the utility bills and repairs as a rental expense.

Property or Services in Lieu of Rent

If you receive property or services, instead of money, as rent, include the fair market value of the property or services in your rental income.

If the services are provided at an agreed upon or specified price, that price is the fair market value unless there is evidence to the contrary.

Example:
Your tenant is a painter. He offers to paint your rental property instead of paying 2 months' rent. You accept his offer. Include in your rental income the amount the tenant would have paid for 2 months' rent. You can include that same amount as a rental expense for painting your property.

Personal Use of Vacation Home or Dwelling Unit

If you have any personal use of a vacation home or other dwelling unit that you rent out, you must divide your expenses between rental use and personal use. See Figuring Days of Personal Use and How To Divide Expenses in Publication 527. If your expenses for rental use are more than your rental income, you may not be able to deduct all of the rental expenses.

See How To Figure Rental Income and Deductions in Publication 527.

10-99 Workers: If you are not sure of the threshold, anything paid above $500 must be reported on a 10-99.

Respectfully,

Tax Sense, LLC
Full in Tax $ense Questionnaire concerning your Taxes.

Written by +Bob Burns.

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"Be Viral" MREIA's President about.me/RobertKBurns Telephone #: 305-300-6242 email: rkburns@investmentpropertiesmiamiflorida.com MREIA's Web Page: www.miamireia.com