There was a great article in Personal Real Estate Investor Magazine this month: Are you prepared for Year-End Tax Tasks? Don’t Leave Money on the Table!
Real estate investors don’t get stuck looking in the rear-view mirror and wishing they had done something different. Please don’t wait till April to meet with your tax accountant because by then you can NOT change your tax liability for 2013. But… if you take the time to meet with your tax accountant NOW you may discover you can make a difference on what you will need to pay Uncle Sam next year.
Example: Property Upgrades -If you are thinking of replacing the carpeting in your rental property at the beginning of the year, you may find getting the carpet installed in December and recording that expense this year could make a big difference on your taxable income and the installer might give you a larger discount because it is their slower season – always good to ask for a discount.
The Complete Idiots Guide: There are lots of great tips like this in the new edition Making Money with Rental Properties that will be out at the end of the year.
Tip: When it comes to taxes ALL expenses need to be documented!!! Even if your painter is happy to do the work on a handshake you need to get a receipt and file it always for the IRS.
Taxes: This is one item in life where creativity is not rewarded – do your research – talk with the professionals and take the time to ASK QUESTIONS before December 31st.