Tax Traps In Lease Option Agreements (AVOID THIS NOW!)

Unbeknownst to you, you're surrounded by tax traps that are sure to reel you in. In this video, Clint Coons, Esq. will discuss how to avoid tax traps on your next lease option agreement.

Let's discuss the tax consequences of entering into a lease option agreement and how you can get yourself into some tax issues by not setting them up the right way.

"You can get yourself into some tax issues by not setting them up the right way." 0:22

We hope this video is able to help assist you with your next lease option agreement to sell your piece of real estate.

Until our next release, please consider subscribing to the channel as it helps us a lot and really is crucial in growing our audience.

Good luck with those lease option agreements, and we will catch up with you next time.

Show Notes:

0:00 Intro
0:13 Lease Option Agreement
4:53 Tax Consequences
6:15 Examples
11:55 Reasonable Terms
14:17 Outro
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ABOUT CLINT COONS

Clint Coons, Esq. is one of the founding partners of Anderson Law Group, Clint has grown his legal and tax firm to over 400 employees by assisting real estate investors with creating and implementing solid entity structuring plans. His success in these regards is in large part due to his personal investing experience. A successful attorney, real estate investor, and speaker, Clint has used his innovative and dynamic strategies coupled with knowledge borne from experience to help thousands of people save millions of dollars and build real wealth.

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The information provided in this video should not be construed or relied on as legal advice for any specific fact or circumstance. Its content was prepared by Anderson Business Advisors with its main office at 3225 McLeod Drive Suite 100 Las Vegas, Nevada 89121. This video is designed for entertainment and information purposes only. Viewing this video does not create an attorney-client relationship with Anderson Business Advisors or any of its lawyers. You should not act or rely on any of the information contained herein without seeking professional legal advice.

#leaseoption #taxtips

[ClintCoons]

I hope this video helps everyone in their journey! Comment below on a topic I should cover next! ⬇

[md]

I just did this with our current home we've been living in for 4 years, Do I have to pay any capital gains tax? lease agreement is for 2 years at $4k a month. $500 of the monthly payment goes towards the purchase price of $600k for payments that are on time only. My home is currently valued at $585k. I've collected a $24, 500 option fee. Do I have to pay any taxes when they exercise the option being that this is our primary home for atleast 4 years? I have two seperate agreements, a residential lease and the purchase option agreement. I took a $500 security deposit for the regular lease, and a $24, 500 option fee for the purchase option agreement. Rental homes in my area are going between $3000 - $3500.

[andrewcraswell]

Hey Clint, I've been getting into lease options with a few of my rentals in markets I don't want to be in for longer than 5 years. It's been a great way to boost profits and have a safe exit strategy before I 1031 exchange into a more expensive market. Can Anderson Business Advisors help write lease purchase contracts?

[ellenoir]

I have a question ⁉️ coach correct me if I'm wrong how I was taught is there's two different agreements on a lease opt you the "lease" which simply works as the rental portion without taking a security deposit or first month rent ect ect....then you have the "option agreement" which you receive the huge down payment and the terms of it is spelled out as far as price, deferred date in time, ect ect... Is the the correct way from a selling point of view?

[emanlopez]

What happens to the "Option Deposit" of 20k if the tenant buyer doesn't execute on the buy? If the option deposit is non-refundable and the tenant buyer walks after 2-3 years, I keep the money and have to pay the taxes on that right?

[E.M.J.]

how is it that the 20k option agreement dowpayment at the end of the video (14:20) is taxed deferred? what qualifies it as a "reinventment"? also is there a certain amount that the credit of $700 at 14:20 has to be? like minimum and maximum since it cant be the entire payment thats credited like the example before

[mattkolasinsky]

Navy Federal asks who is the Beneficial Owner during the application process for a Business bank account. How do you maintain anonymity while answering that question?

[gabrieldineros]

You're my HERO, future partners here in few weeks

[mattkolasinsky]

Hey Clint do you have turnkey wholesale quads or singles for sale whose titles are clear and free?

[robhemmerle]

This video couldn’t be more relevant to me. This is our exact business model! We don’t have any of the monthly rent go towards the property value to avoid any issues with it looking like a sale. Do the option funds paid by the tenant have to be kept isolated in an account or can they be used by the business in the meantime since technically those funds are gone unless they purchase the home? I believe you mentioned at the end of the video they can be invested. Just wanted to make sure.