17159 Albion St, Detroit

My question was not around deductibility (although that also seems uncertain). My question was whether you get a credit off your OZ tax for tax you have already paid in the US. And does that credit apply only to Federal taxes, or does it equally apply to US state taxes? It seems State taxes are excluded based on the information @euro73 provided.

 

Simple. My word against his.
Best to check with your accountant.


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The US-AUS treaty hasn't changed since 1983.

I said 4.25%. Not 4.75%

Not the price. You said 33K. Your website says 37K
Not the rents . You said 10.8K. Your website says 9K
You claimed the property cloud be repaid in @ 3 years. We know its more like 11-13 years depending on whether the rental income tips you into the 37% or 45% Australian Marginal Tax Rate. Even if we are generous and said 8-10 years, you have still misled people.
Now you cant even get the Michigan state tax rate correct. This is the state you live in and work in and run a business in and keep posting about. You should know this stuff inside out and back to front after 8 years and hundreds of properties transacted there....

It cant just be put down to a mistake, as others have generously suggested may be the case, because you have posted these misleading numbers on many occasions previously and you have doubled down when there were queries made on each of those occasions previously.

I havent made any claims . I have questioned your claims. I have also posted links to US and Australian Govt information related to the topic. It's the ATO website that says State Taxes are excluded. I didnt create that content. I just cut it and pasted it. if it's incorrect, I'm happy to stand corrected - but where is the the legislation or ATO fact sheet that says so?

 

It is ATO not the US-Aus Tax treaty.

Yes the numbers are dancing. I am Dyslexic.
You must be happy I quoted 4.75% instead of 4,25% right?
It does not change the bottom line numbers though.
Because ATO gives you a credit for All genuine payments to run a rental.

Check the MLS.

Oh really! Congratulations.
Do your number again.
33,000 purchase price.
900 rents.
Tax - 1124.19 per annum
Maintenance - 900 (super generous) per annum
Insurance - 564 p.a
management fee - 8% of rental or 72 per month
vacancy - add 5.5% per annum (which no Australian calculation gives)

And is just the start.
More to come..

 

I googled - it is 4.25%
And it is part of your ATO deductible.
And just saying - does 10% GST in Australia stop a plumber or a Bricklayer to stop his trade?

 

Of the nett Income, you make. After all expenses.
Rent minus all expenses to run a rental.

 

Absolutely, Geoff. Nothing too big to bicker about.
Ask any one Investor if he/she was concerned about State taxes in Georgia (Atlanta).
@Karina can tell. She was the queen of that market.
I personally bought 21 properties in Atlanta. And still hold them for cashflow.

Not one investor has had an issue with 'state taxes' since 2011. Not one.
Because the Cash flow is for real and the Capital gains is a modest few 100s%
These properties sold at 100K plus in 2006.
They are 30-40Ks now. Because of the crash.
If I as an investor don't make money on them now, someone else will.
Domestic US investors are all over them in Detroit currently.
As we saw in Atlanta between 2011 and 2014.
Prices went sky high in a short spurt - as opportunity does not wait for any of us.
We snipe, snooze or we lose, humbly from my experience,


.

 

Hi All,

Haven’t commented on the forum for some time- however would like to say the following points without having to get in the sandpit and play.
We are the current owners of the above mentioned property.
We get $900 per month rent.
There are associated costs which are not high and we get an excellent rental return- better than most Australian residential and commercial returns.
It is in our SMSF and as such is treated under Australian SMSF tax law.
As we have only taken this property on there are no tax figures to discuss as yet. We can only say that in our most recent U.S tax return on other property we hold we were pleasantly surprised after depreciation we had no tax to pay- only a lodgement fee. In fact we will get money back from Australian tax return and property is already cash flow positive- which plays around with figures mentioned in the above thread.
We are extremely satisfied with the high rental returns in our SMSF that this property will provide and anticipate growth as well, which accelerates the rate of return over a period of time.
We have been able to achieve this success through working with Can-I-Invest and have to say the experience has been easier and more pleasurable than dealing with similar people in the Australian market.

Every property needs to be assessed and due diligence performed, along with your own risk profile to work out what is best for yourself. We have been burnt before by proposed experts -some of whom may even contribute to this forum- I wouldn’t know- as everyone has an avatar/ alias of whom they are.

I will however conclude, and not write further on this thread, by saying-For our situation - we have bought this property as one of many in our portfolio and believe it will be a great little money maker for us.

 

This post above is from the actual SMSF owner of 17159 Albion who purchased the property with us facilitating the transaction.

Thank you, much appreciated.
And thank you for the support, endorsement.
Means much,

In the US, your property, irrespective of age, whenever it was built, will and can be depreciated over 27.5 years. IRS rules. Whoever buys. Whatever the property age. Simple rule. Love it. No need for Depreciation schedule. Or list of items.
Actual numbers, check.

 

Thats an SMSF, where the 15% MTR is below the combined US and State taxes, so of course there's no tax to pay here. How about a property purchased in a trust where money is distributed in Australia and taxed at MTR's of 32.5% or 37% or 45% ( minus relevant FED taxes) . There would certainly be some residual Australian tax to pay then, I would imagine?

SMSF's are not a good example. We want figures for individual tax brackets .

Separately - will you pay it off in 3 years ? because that's the claim that began the thread and provoked the questions.

Come to think of it...if it's worth the 80-85K claimed by our learned colleague, why not just sell it and go again... and again... and again... and again....?

You can roll the 50K profits over tax free by all reports. Thats 50K US per deal. Just 20 of these deals and you'll have $1Million USD in your SMSF - cash. Then you can buy 30 of these things with cash ( at 33K each) and be earning 10.8K x 30 ($324,000USD) and paying no tax on it in Australia , but the asset base will be worth 2.4 Million USD ( 30 x 80K)

 

Hi Geoff,
There is Depreciation - Irrespective of age.
Even if the property was built in 1800 or earlier.
Over 27.5 year any buyer can claim this amount of purchase (rule of thumb is 90% is building and 10% is considered land value) as Depreciation loss with IRS.
Land value of 10% cannot be depreciated.
But the 90% of the value of purchase which is considered Building is depreciable.

 

I didn't think we could buy in the states with out a I come coming from with in the states?
But then you still need a green card don't you?

 

Anyone can buy all you need is cash


The world is buying, been the case since 2011 when many markets started recovering/rising

Detroit is now in recovery mode

 

Where's the evidence of that ? I've provided information from the Australian Taxation Office and from the United States Government that implies that is not the case. I am happy to be corrected, but you can't reasonably expect any reader to simply take you at your word because you say you "googled it" - If you found relevant information proving the state component is able to be offset in Australia, please provide it.