How New Fiscal Crisis Bill Affects Wholesaling Homes

How New Fiscal Crisis Bill Affects Wholesaling Homes

Politicians struck a last moment deal to avoid the worst effects of going over the fiscal cliff but how will this new bill affect wholesaling homes in the months ahead?

Neither side got everything they wanted out of the new Fiscal Crisis Bill but there appears to be just enough to provide everyone a little better outlook than falling over the cliff, which it would have resulted in.

There is good and bad in the new bill, but for those wholesaling homes, it all really comes down how these changes are capitalized on and navigated.

With over $600 billion in tax hikes under the new plan, most of which are set to slam those making more than $450,000 a year, we’ll certainly see many affluent Americans restructuring in the next year.

Many wholesalers certainly fall into this category and will be wise to avail themselves of the best tax advice they can afford. However, with real estate still an incredible investment from a tax perspective, we could also see a surge in more high income earners buying homes.

On the downside, the government plans to offset much of its spending via increased revenues from those switching their retirement savings plans. This could take away some advantages for those planning to invest in real estate through their IRAs, but when the larger picture is taken into consideration, more should be moving their cash into real estate and the higher returns it can provide should offset any higher taxes.

Perhaps one of the best parts of the new Fiscal Crisis Bill is the extension of tax breaks to businesses for acquiring new property and research. This can be a direct benefit for investors wholesaling homes, as well as providing a huge indirect increase in income as businesses rush to take advantage of the benefits during the 12 months they have left to do it.

While the information about the plan, which is already being leaked out, gives those wholesaling homes plenty to work with in terms of adjusting strategy and marketing plans, more changes are definitely coming.

Many of the current provisions go out several months, but Americans ought to expect more political standoffs, hype, increased spending and higher taxes ahead. Right now the U.S. remains one of the most attractive countries on the planet for investing in real estate, but investors wholesaling homes do need to keep an eye on these events, look for ways to continue to minimize their own tax exposure and how they can position themselves to meet the needs of those being affected by new moves.

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