View Single Post
Unread 08-06-2013, 02:10 PM   #230
oifmarine2003
is One Chatty Farker

 
oifmarine2003's Avatar
 
Join Date: 11-26-12
Location: Grayslake, IL
Downloads: 0
Uploads: 0
Default

Quote:
Originally Posted by Just BS View Post
How does that work???? You cant write off any of the principle payment as a business expense? Doesn't make sense to me. Would it be "creative accounting" to put the old lady as the owner of the business and then lease it to her while you pay the mortgage?
Think of it this way. If you are leasing something, at the end of the lease term you will have no asset (i.e. the building) to show for it. All of that money has gone to basically renting it from someone else. On the other hand, if you were to buy it, those same payments you are making are leaving you with a piece of the asset. With each mortgage payment, you have more equity in the building. At the end of 15 or 30 years,depending on the mortgage, you will have an asset that you own (the building). If you leased it for 30 years, at the end of the lease, you would have no asset. That is why lease payments are deductible.

Also, you can write off property taxes if you own the building but not if you lease it.
__________________
Chris

Homemade Wood Smokehouse, Charmglow gasser, Smoke Hollow, UDS, dual chamber homemade grill, Uline Weber Kettle
Certified MOINK Baller

UNLINED DRUM KING OF CHICAGO AREA

Scrap Iron Chef
oifmarine2003 is online now   Reply With Quote