No. of Recommendations: 0

My wife and I live if California (Bay Area) and currently rent an apartment. We are skeptical about buying a house in the Bay Area because we think valuations are way out of whack. To buy something similiar to what we are renting would be 3 times our monthly rent so we are better off renting for the time being.

We have been thinking that a good way for us to enter the real estate market is to buy a property in another part of the country and use it as a rental property.

So I have lots of questions about how to go about doing this and what the tax implications are.

1) Does the fact that we don't own a primary residence have any tax implications for us?

2) Can we deduction the mortgage interest off our taxes?

3) If the rent we get for the property doesn't cover our expenses (i.e. mortgage interest, property tax, and upkeep) can we deduct that as a loss off our taxes?

4) How does the financing work? Do you have to put 20% down on rental property?

5) Who would be the best person to discuss this with? A CPA?

Any help or suggestions would be most appreciated!!! Thanks!!

Print the post  


When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.