Tax Deductions on Rentals for Landlord and Investor

Tax Deductions Every Property Investor Should Know About

Did you know that rental properties provide more tax benefits than most other investments? Were you aware that by owning rentals you are entitled to deduct on your taxes a full array of necessary business related expenses towards conserving, managing and upkeep that are associated with your rental investment properties?

The many available tax deductions on rentals can have a significant impact.

Almost everything you buy for your rental business is tax deductible, so long as it is ordinary and necessary and the cost is not unreasonable. These deductions can really add up and increase your bottom line. No one wants to pay more than necessary to fix up their rental units or pay more than they have to for utilities or other operating expenses for a rental property, so why pay more taxes on your rental income than necessary? Yet, surprisingly many tax benefits are overlooked by the investor.

Investors can deduct mortgage interest payments on loans used to acquire or improve rental property, interest on credit cards for goods or services used in a rental activity, homeowner’s association dues, special assessments, wages and salaries for employees, such as on sight residential managers and maintenance workers and even for legal and professional services such as attorneys, accountants, property management companies and other professionals.

Other tax-deductible services that can be used as deductions are independent contractors, needed for the repairs or maintenance of the property, such as a handyman, electrician, plumbers; pest control, lawn and garden upkeep, preventative work; roofers, painter etc….

Additionally if you rent equipment and tools or buy material and supplies, these too are fully deductible as a business expense.

If your rental property is damaged or destroyed like from a fire or flood, you should be able to obtain a tax deduction for your casualty losses.  And speaking of casualty, you can also deduct the premiums you pay for most insurance for your rental property.

Bottom line – speak with an experienced accountant and let him/her guide you on how to maximize the tax deductions on rentals and your property. You may have a tax deduction gold mine.

About Octazon:  Whether you own a few properties or hundreds of properties in Florida, Octazon Management, LLC is here to simplify property ownership and management. We can help you manage any and all of your properties.  At Octazon we provide simplicity & peace of mind.  Octazon uses cutting edge, cloud based property management software that fully integrates the entire property management and financial process enabling the investor direct access to valuable owner/investor information and reports 24/7 that helps you and your accountant identify all your valuable tax deductions.  

When providing management services to Realtors, Octazon will NOT provide the leasing, rentals or sales – so you never have to worry about losing control of your relationship with the owner. 

Providing Simplicity and Peace of Mind™ 

Call us 954-674-2467 or email us at info@octazon.com today.

Check us out @ www.octazon.com 

SINGLE FAMILY HOMES- MULTI FAMILY – COMMERCIAL – OFFICE INDUSTRIAL

Holiday Decoration Displays

RIGHTS TO DISPLAY RELIGIOUS DECORATIONS

Be careful not to restrict your Tenants Religious  Freedom and their First Amendment rights

As we are full swing into the holiday season, landlords need to be careful not to trigger a fair housing complaint filed by an apartment renter who claims they are a victim of religious discrimination.

Landlords should re-familiarize themselves  with an earlier blog I wrote called “Happy whatever Day” regarding the rights of tenants to put up holiday decoration displays and religious symbols AND remember that it is only the lobbies, hallways and other common areas of your property where you need to concern yourself in making sure they are maintained in a religiously neutral state.

However, while common area religious displays should be avoided, residents should always be allowed to decorate their units as they desire and display any personal religious items in their own apartments.

But what about placing their holiday decoration displays or religious symbols on their windows, their front doors or balconies?  Tenants should be allowed to display their religious items, even on the outside of their individual apartment doors. However, the landlord can create fair polices (that are enforced consistently) for seasonal displays that face the outside and  can limit these seasonal holiday decoration displays  to a specific period of time, for example a two-week period, to avoid having these decorations still hanging around in the spring.

Always endeavor to create an atmosphere that is inclusive and welcoming for all faiths and traditions. Most often, this is the best way to avoid complaints and ensure a peaceful and harmonious holiday season for all you tenants.

However, you can’t please all – and if other tenants complain about how their neighbor is decorating the outside of their unit, before you make a rash decision or take any action, call your lawyer for guidance.

 

About Octazon:  Whether you own a few properties or hundreds of properties in Florida, Octazon Management, LLC is here to simplify property ownership and management. We can help you manage any and all of your properties.  At Octazon we provide simplicity & peace of mind.  Octazon uses cutting edge, cloud based property management software that fully integrates the entire property management and financial process enabling the investor direct access to valuable owner/investor information 24/7.

When providing management services to Realtors, Octazon will NOT provide the leasing, rentals or sales – so you never have to worry about losing control of your relationship with the owner. 

Providing Simplicity and Peace of Mind™ 

Call us 954-674-2467 or email us at info@octazon.com today.

                        Check us out @ www.octazon.com 

SINGLE FAMILY HOMES- MULTI FAMILY-COMMERCIAL- OFFICE-INDUSTRIAL

THE WELL DRAFTED COMMERCIAL LEASE – Landlord Rights & Remedies

Landlord take note – there is significant benefit to creating a well drafted commercial lease.

While the Florida’s commercial Landlord and Tenant statute, Chapter 83 Part I, provides a general framework for enforcing the landlord’s remedies, many of the statutory rights and duties may be modified or waived between the parties in a well crafted lease. Additionally, in the commercial arena, case law also plays a large role in interpreting the commercial landlord and tenant relationship.

For example, the strict and specific laws about security deposits found in the Florida’s residential Landlord Tenant Statute, Part II does not apply to the commercial arena. Rather, security deposits are governed by whatever the parties agree to be bound to, as set forth in the lease between the parties, while the liquidated damage provisions are governed by case law.

 In residential leases it is common for the Realtor and investor to gravitate towards a form lease promulgated by the Board of Realtors and Florida Supreme Court – “The FAR\BAR Lease” – which is very Tenant friendly leaving the landlord without important protections. (See more in our article on the subject – Landlord Friendly Leases )

However, when it comes to a commercial lease, landlords should instruct their Realtors to take advantage of the benefit that case law and waiver plays in the commercial arena and therefore, instruct their agents to engage a strong commercial attorney to draft a commercial lease and insist that a standard or generic commercial form not be used. A strong, detailed, sophisticated commercial lease needs to be tailored for the specific transaction and property to provide the necessary rights and remedies of the Landlord, and to be most protective of the Landlord and their investment.

It is important that the customized terms of the commercial lease be drafted clearly since any ambiguity in the lease is construed against the drafter. So make sure to engage an attorney familiar with commercial transactions.

When it comes to managing your multi family & commercial properties, rest easy – Octazon Management has got you covered, can protect your assets and take away your property management headaches and distractions through our full-service or back office property management services. Octazon uses advanced technology that allows us to stay connected and maintain transparency with our clients.

When providing management services to Realtors, Octazon will NOT provide the leasing, rentals or sales – so you never have to worry about losing control of your relationship with the owner. 

With Octazon, we bring order to residential property ownership.

Call us 888-324-9528 or email us at info@octazon.com today.

APRIL IS NATIONAL FAIR HOUSING MONTH PART II – Advertising Caution

In my last blog I noted that during the month of April, Fair Housing will be celebrated across the country, as a reminder that when dealing with a tenant (whether prospective or actual) to be very careful and diligent in not violating the Fair Housing Laws. ( See- April is National Fair Housing Month – Know the Laws)

Owners and Investors need to be careful how they advertise to prospective Tenants.

Of course it is ok to market your property and accentuate the features, amenities, qualities of your property and its location,BUT DO NOT MARKET for the type of tenant you want.

For example: Do not advertise or make statements that make a potential tenant feel unwanted by using words like -restricted, safe, exclusive, private, integrated, traditional, perfect for  single professional or great for young couples. All these phrases can be considered discriminatory towards prospective renters simply because they imply that you restrict to whom you rent.

A good idea is to use the fair housing logo or include a statement of non-discrimination at the end of each ad.

Remember Fair Housing claims can be expensive and damaging to your reputation so avoid these common Fair Housing mistakes.

When it comes to managing your single, multi family, commercial properties, or second homes, rest easy – Octazon Management has got you covered, can protect your assets and take away your property management headaches and distractions through our full-service or back office property management services. Octazon uses advanced technology that allows us to stay connected and maintain transparency with our clients.

When providing management services to Realtors, Octazon will NOT provide the leasing, rentals or sales– so you never have to worry about losing control of your relationship with the owner. 

With Octazon, we bring order to residential property ownership.

Call us 888-324-9528 or email us at info@octazon.com today.

Check us out @ www.octazon.com

APRIL IS NATIONAL FAIR HOUSING MONTH – KNOW THE LAWS

During the month of April, Fair Housing will be celebrated across the country.

The Fair Housing Laws are there to protect people’s basic rights and dignity. It is a punishable offense to violate them.

Fair Housing Month is a reminder for all: property managers, realtors, asset managers, maintenance teams and any one else dealing with a tenant (whether prospective or actual) – to be very careful and diligent in not violating the Fair Housing Laws.

Among the more common Fair Housing mistakes are:

  • Failing to train all employees who interact with a tenant or prospective tenant on Fair Housing laws;
  • Denying a disabled tenant’s request for comfort or emotional support animal because your lease doesn’t allow pets or denying a disabled tenant’s request for a more convenient parking spot simply because you feel its unnecessary;
  • Asking a prospective tenant inappropriate questions such as “How many kids do you have?” or “Are you pregnant or married?” or “Have you ever been convicted of a crime?” or “What is your age?”; And
  • Failing to track the other additional protected classes beyond the “Federal Seven” in your city, county or local area of operation.

It’s a litigious world, so EDUCATE & PROTECT YOURSELF & YOUR TEAM……… You can do this by:

1 Disseminating important Fair Housing information to your team

2. Post Fair Housing posters in your management office

3. Document your actions so you can justify it later in the event of litigation

4. Adopt written policies and stick to them….. Be Consistent in your enforcement!

5. Test your staff. From time to time check to be sure that your leasing staff is following the rules- do mock phone calls and see how they respond.

6. Go to one of Octazon’s seminars and continuous education classes.

For More on Free Housing and how to advertise your property according to the laws, check out part two of this post – APRIL IS NATIONAL FAIR HOUSING MONTH PART II – Advertising Caution  

When it comes to managing your single, multi family, commercial properties, or second homes, rest easy – Octazon Management has got you covered, can protect your assets and take away your property management headaches and distractions through our full-service or back office property management services. Octazon uses advanced technology that allows us to stay connected and maintain transparency with our clients.

When providing management services to Realtors, Octazon will NOT provide the leasing, rentals or sales– so you never have to worry about losing control of your relationship with the owner. 

With Octazon, we bring order to residential property ownership.

Call us 888-324-9528 or email us at info@octazon.com today.

Check us out @ www.octazon.com

THE BREAK IN – WHO’S RESPONSIBLE TO REPAIR OR REPLACE

If you manage or own a bunch of properties, it is likely that at some point you will receive a call from one of your multi-family tenants that someone busted a window or door and broke into their unit. The tenant will then request that the landlord fix their door or window or other burglary damages. What’s a landlord obligated to do in such a situation?


The answer is not so simple – and encroaches upon a gray area.

In general when a situation like this happens (an alleged crime is being reported by your tenant), ask the tenant if he/she filed a police report. If he/she says no – ask why not? If one was not filed it is suspect that some burglar really broke the door and window. Perhaps the tenant did and is making this up to have the landlord fix the problem.  Under FS 83.51(4), a tenant is responsible for any damage caused by the tenant, a member of the tenant’s family, or other person on the premises with the tenant’s consent.


If however the tenant did file a police report, ask for a copy.  If this tenant was truly a victim of a third party crime, it is quite possible the judge will allocate the repair responsibility to the landlord – despite language in the lease to the contrary.   When there is a criminal act involved, it is very challenging to predict how a judge will respond and you can’t simply rely on the language in the lease.


Therefore, if a police report was generated and the tenant is asking for the door/window to be repaired, the owner should get the door/window repaired ASAP and then later on figure out who will be responsible to pay.  


If the same situation occurred in a single family home or duplex and the lease allocated all repairs to the tenant, such a clause may hold up since these types of properties allow for the landlord to place greater burdens and obligations on the tenant.


When it comes to managing your single, multi family or commercial properties, rest easy – Octazon Management has got you covered and can take away your property management headaches and distractions. Our full-service property management company can handle everything from tenant and vendor management to maintenance and landscaping, to providing an up to date PDF strong LANDLORD lease prepared by an attorney (through Octazon Law), 3 day notices, eviction management, detailed financial reports and many other services through our advanced technology that allows us to stay connected and maintain transparency with our clients.

When providing management services to Realtors, Octazon will NOT provide the leasing, rentals or sales – so you never have to worry about losing control of your relationship with the owner. 

With Octazon, we bring order to residential property ownership.  Call us 888-324-9528 or email us at info@octazon.com . Check us out @ www.octazon.com 

DEATH OF A TENANT – THE DO’S AND DON’TS

When the only remaining tenant on a lease dies, it raises issues and presents challenges. While a landlord’s reaction of how to approach this situation may seem logical, common–sense, reasonable and proper, it may also be illegal and costly.

 

Florida Statutes 83.59 and 83.67 sets out rules for how the landlord can re-take possession of the unit and how to handle the abandoned property. The good news is that a properly worded lease can help the landlord navigate the challenges due to the death of a tenant.

 

Landlords need to keep in mind that upon death of a tenant, the Landlord cannot immediately re-take and re-rent the property, dispose of the personal property, or grant access to anyone – even children or the sole heir – even if they can produce a Will. Additionally, powers of attorney are no longer valid.

 

So what’s a landlord to do to protect themselves from this event – which is becoming more common? For starters, make sure you lease contains the language set forth in Florida Statute 83.67.

 

BY SIGNING THIS RENTAL AGREEMENT, THE TENANT AGREES THAT UPON SURRENDER, ABANDONMENT, OR RECOVERY OF POSSESSION OF THE DWELLING UNIT DUE TO THE DEATH OF THE LAST REMAINING TENANT, AS PROVIDED BY CHAPTER 83, FLORIDA STATUTES, THE LANDLORD SHALL NOT BE LIABLE OR RESPONSIBLE FOR STORAGE OR DISPOSITION OF THE TENANT’S PERSONAL PROPERTY.

If your lease contains this above language and (a) The last remaining tenant is deceased and (b) rent remains unpaid, and (c) at least 60 days have elapsed following the date of death, and (d) the landlord has not been notified in writing by relatives, friends, the court etc…of the existence of a probate estate being opened or that a personal representative has been appointed, then after the 60 days have elapsed and you complied with the above steps, the unit is yours to re-take, re-rent and dispose of its contents as you see fit.

 

In the event a probate estate is being opened, a claim would have to be made in that probate proceeding for anything due under the lease. In that case Landlord should deal directly with the personal representative. The Landlord can also allow access to those that have court authorization through “letters of administration” and can evict or file other necessary motions by suing the estate through serving the personal representative.

 

While this overview gives the landlord direction on handling the death of a tenant, it is best before taking any action to call your attorney and let the attorney walk you through the process to avoid any costly mistakes.

 

When it comes to managing your single and multi family residential properties, rest easy – Octazon Management has got you covered. Our full-service property management company can handle everything from maintenance and landscaping, to screening potential residents, preparing leases, marketing, advertising and managing your properties online with our advanced technology that allows us to stay connected and maintain transparency with our clients.

 

With Octazon, rest easy, because we bring order to residential property ownership.

 

Call us 888-324-9528 or email us at info@octazon.com today.

 

Check us out @ www.octazon.com

 

 “Single Family Residential – REO – Multifamily – Commercial”

 

Why Realtors Should NOT Do Property Management

Realtors and Property Management should not mix.

Many real estate agents take on property management services as a courtesy to their important investor clients. Management is important – but distracting. Agents are burdened with all the reporting, collection, disbursement of funds, payment of bills and maintenance responsibilities, which preclude them from making more sales. They just don’t have the time to do what they do best – help investors purchase more properties. Additionally, real estate agents with property management responsibilities tend to limit the geographical area where they will show investment properties for fear that the drive between managed properties will be too time consuming.

Realtors should stick to what they do best – making the sale – and let a property management company do what they do best – managing their sales.

Octazon Management provides professional property management service for real estate sales professionals and brokers. At Octazon we provide simplicity and peace of mind!

When providing management services to real estate professionals and brokers, Octazon will not provide the leasing or sales- so the Realtor will never have to worry about losing control over the client.

Whether you own a few properties or hundreds of properties in Florida, Octazon Management, LLC is here to simplify property ownership and management. We can help you manage any and all of your properties. Call us 888-324-9528 or email us info@octazon.com today.

Check us out @ www.octazon.com

“Single Family Residential–REO – Multifamily- Commercial- Office-Industrial”

Landlord responsibility: Is it too much?

You might be wondering whether you should bother hiring a property management company or just handle the management of your residential properties on your own. There are several factors to consider, such as the amount of properties you own, your property’s location compared to your primary residence and the huge landlord responsibility and requirements which you are obligated by.

As a landlord, your responsibilities include, but are not limited to, ensuring that your property is up to code and that it complies with all building, housing, health codes, rules, regulations; handling the maintenance and repairs of the property; making sure any electrical equipment you provide is safe; and ensuring the property is clean, safe and sanitary for tenants to live in.

The landlord’s obligations to maintain the premises are governed by Section 83 of the Florida Landlord and Tenant Statute; the Florida’s building, housing, health codes and regulations; the type of rental unit – single family home or duplex vs. triplex or apartment ( multifamily); and the terms of the lease/rental agreement.

You are also responsible for filling vacancies. Not only must you fill any vacancies with new tenants, you must oversee existing tenants and, occasionally, evict tenants. You must handle all tenant complaints and ensure that you fully understand the landlord-tenant law and Fair Housing Laws to avoid any legal ramifications, including costly lawsuits.

A property management company can handle all of the above and much more. They can help add value to your investments by lowering costs and even increasing revenues. They can screen tenants to fill your vacancies with the best possible candidates, which can, in turn, lead to fewer complaints, avoid potential lawsuits and ultimately fewer evictions.

Being a landlord is a difficult, challenging and time-consuming job. There is a lot to consider before you take the leap and begin to manage your property—or properties—on your own.

About Octazon:

Whether you own a few properties or hundreds of properties in Florida, Octazon Management, LLC is here to simplify property ownership and management. We can help you manage any and all of your properties. At Octazon we provide simplicity & peace of mind Call us 888-324-9528 or email us info@octazon.com today.