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21 Cards in this Set
- Front
- Back
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Return |
Return is total income, both direct cash flow and indirect benefits such as depreciation and appreciation |
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Leverage |
Using borrowed money (financing) to yield higher returns |
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Appreciation |
The increace in property value |
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Income property |
Properties held for producing income as well as for a profit on its sale |
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Cash flow |
Spendable income generated from an income property |
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Pyramiding |
The practice of holding and refinancing property, using its equity and appreciation buildup, rather than selling or exchanging already-owned properties and an investors holdings can be increased without investment of any additional capital |
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Exchange |
Capital gains taxation deferred by a like-kind property when capital gains when completely used to cover second property |
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Capital gains |
A taxable profit on an investment; in real estate, its the difference between the adjusted basis of property and its net selling price |
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Basis |
The investors initial cost for the real estate |
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Adjusted basis |
Is the capital gain taxable as income |
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Depreciation (Investor) |
An accounting concept that allows an investor to recover the cost of an income producing asset by way of tax deductions over the period of the assets useful life |
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Tax credit |
A direct reduction in tax due, rather than a deduction from income before tax is computed |
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Installment sales |
A taxpayer who sells real property and receives payment on a installment basis, in which is paid over a period of years, may report any profit on the transaction year by year as it is collected |
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Marginal tax rate |
The rate which the top dollar is taxed |
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Syndicate |
The joint together of two or more people or firms to carry out one or more business projects |
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Real estate investment syndicate |
A form of business venture in which a group of people pool their resources to own and/or develop a particular piece of property |
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Real estate investment trust (REITs) |
A trust account for a real estate investment syndicate in which investors can take advantage of the same tax benefit as mutual fund investors |
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Bill of sale |
A certificate of transfer of personal property |
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Uniform Commercial Code (UCC) |
The body of law that regulates and governs the transfer of personal property |
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Bulk Transfer Act |
is a law to protect business creditors. It provides that if a buyer of a business notifies the creditors of the seller in advance that it is buying the seller's assets, then the buyer will not be liable to those creditors for the debts and obligations of the seller. |
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Boot |
The difference of cost; when the property being bought, the replacement property, cost less than the one being sold |
