Business Times of Edmond, Oklahoma February 2020 - Page 25

are more expensive to operate. Renter turnover and unit damage can be greater — especially in a college town. But with many units at higher rental rates, your income can be enhanced. After you understand what’s involved, it may be sensible to hire a property manager to free up your time. As for income taxes, each year you report your rental receipts, minus your rental expenses, less depreciation. Residential real property is depreciated using a 27.5-year life. House flipping — Many people have the talent and time to buy a home (on the cheap) that needs significant modernization and sell it quickly for a short-term gain — as seen on TV. House flipping is risky. If you take this on, be ready to part with your cash if things don’t line up as planned. Taxwise, house flipping is generally treated as a purchase and sale of a capital asset with any profit reported as a short-term capital gain if held less than one year. Any short-term loss would be netted with other capital gains and total losses limited overall to $3,000 and the excess carried forward for 20 years. If a flipper holds their project for more than a year, lower capital gain rates would apply. House flipping gets more taxing and complicated if the flipper’s hours exceed 500 during any year. Commercial rental property — The commitment to managing commercial property is like residential rental except that businesses will usually pay more for rent. As such, commercial rental provides more cash to pay property managers, rental agents and improvements which can be built into the rental agreements. Commercial property will generally be a larger investment. For tax purposes, non- residential property is depreciated over 39 years. If I didn’t mention your favorite real estate investment method, please forgive me since I just listed the ones that I see most. Know that there are other ways to invest. Above all, I believe that real estate offers much opportunity to the individual investor. It’s just a matter of finding what works best for you. JIM DENTON is the managing partner of Arledge & Associates, PC where he is responsible for providing leadership to the CPA and Wealth Management firm, Summit Capital Advisors, LLC. Mr. Denton empowers his clients, so they may live their best life. He may be reached via email at jim@jmacpas.com. Securities offered through Avantax Investment Services SM , Member FINRA, SIPC. Investment advisory services offered through Avantax Advisory Services SM , Insurance services offered through an Avantax affiliated insurance agency. GROWING EDMOND PHOTOS PROVIDED | EDMOND AREA CHAMBER OF COMMERCE Ribbon Cuttings RIBBON CUTTING AT PREVAIL STRENGTH AND FITNESS Prevail Strength and Fitness recently held a ribbon cutting with the Edmond Area Chamber of Commerce to introduce the gym to the community. Prevail Strength and fitness is a small group and personal training studio that helps busy professionals find their strength and confidence in and outside the gym so that they can elevate their career and enjoy adventure. Their goal is to teach students how to approach strength and nutrition in a holistic approach that elevates all aspects of their life instead of consuming it. “We love our pull ups just as much as our tacos. We believe in quality over quantity and aim to give the individual the best experience while being a part of a group of like-minded individuals,” said owner Sean Shearon. For more information, visit www.prevailstrengthandfitness.com. NEUROWELLNESS CELEBRATING GRAND OPENING NeuroWellness Clinic recently held a ribbon cutting with the Edmond Area Chamber of Commerce to celebrate their grand opening at 178th and Portland Avenue. NeuroWellness provides diagnosis, treatment and neurological research for a variety of conditions including Alzheimer’s disease, Opioid dependence, Epilepsy, chronic pain, migraines and more. With more than 25 years of experience, Director Kent Smalley, MD, leads the clinic. For more information, visit www.tellaneurodoc.com. February 2020 | The Business Times 25