It sounds unkosher because very few people would knowingly lower the real value of their home by $200,000 in order to take $200,000 in tax deductions (of which you would only get back maybe 30% or $60,000 on your taxes). Why give away $200k to get back $60k at tax time?

You would only "donate" $200,000 and take the deduction, if you knew it didn't actually lower the value of your home by as much as you are claiming it does. That's why the IRS is looking so hard at this, generally speaking, they know the donation probably didn't change the value of the house as much as is being claimed. Not that many people are preservation-minded enough to honestly donate away hundreds of thousands of dollars in real equity.

Posted by: setancre at November 4, 2009 2:52 PM in response to Easement Audit Nightmare

This link explains conservation easements pretty well I believe, but is more geared toward rural property.

http://www.grandriverpartners.org/easements.htm

I think the main concept behind the easement is that you donated portion of the value of your home toward the greater good (by preventing development/alterate uses/aesthetic alterations, etc) and are taking a deduction on the loss you incurred because of this donation. The easement is attached to the deed, so any new buyer must also use the home according to the easement you put on it (hence where your loss comes in, because you theoretically wouldn't be able to sell it for the same price as you would get without an easement).

i.e. If the house is appraised at 1.2 million before easement and 1.1 after easement you are eligible to deduct the 100,000 you "donated". The problem you will probably run into is that you may not have actually lowered the value of the property at all with the easement (since alterations to the structure are already regulated by LPC). And since you sold if for $600,000 more 3 years later, it also may be very difficult to show that you suffered any sort of financial loss by putting the easement on the property for which you deserve a tax deduction. You may want to try pulling comps that show you could have gotten a higher price for the home if you had sold the property without any easements.

Posted by: setancre at November 4, 2009 12:39 PM in response to Easement Audit Nightmare

That is just about right for bathroom labor by a licensed and insured contractor.

Posted by: setancre at October 26, 2009 10:56 AM in response to Bathroom Quote

Unless you've paid for the rights to their design, I'm pretty sure the design & drawings are considered their intellectual property, and you are not allowed to shop them to another contractor. You would have to start fresh with another firm.

Posted by: setancre at October 14, 2009 10:12 AM in response to Changing Design/Build Midstream?

I would search apartments on NYTimes and craigslist that are for sale in your neighorhood, and start jotting down maintenance for studios, 1 bed, 2 bed in different buildings in Excel. It's going to be hard to go by sq ft because co-ops don't generally have standardized sq footage measurements, but you can go by what the broker says the sq footage is, or simply try to eyeball it from the floorplan and/or photos in the listing.

Posted by: setancre at October 7, 2009 11:16 AM in response to How To Compare Maintenance

If you post a link to your ad maybe ppl here will have some constructive comments.

Posted by: setancre at October 6, 2009 10:20 AM in response to Advice on Rental Market

I would divorce the kitchen project from the bathroom project. Since you are doing Ikea kitchen cabinets, you can price those directly from Ikea and use their certified installer (approx $100/cabinet) for assembly and installation. They can coordinate countertops for you as well (price completely depends on choice of material, can be $25/sq ft to $120/sq ft). Figure out what kind of tile you want on the floor, buy it yourself, and have your own tile guy install it. I've successfully used Rob Mara for tiling, he is recommended a lot around here.

Then I would have separate estimates done for only the bathroom work. Try to decide on fixtures beforehand (new vanity, faucets, etc).

By lumping everything together for both kitchen and bathroom you're giving the contractors an opportunity to build in extra hidden $$ on everything they touch.

Posted by: setancre at October 5, 2009 2:56 PM in response to Contractor Estimates

I would at least knock on the door and request access. If the odor smells obnoxious to you, and they refuse entry (or aren't there), and also refuse to set up a future date for you to inspect the apartment, I believe you could call in a complaint to 911. There was an article recently in the Daily News about a hoarder with floor to ceiling trash and police and/or firefighers are allowed to gain access to an apartment if they have reason to believe there is imminent danger or hazardous conditions. As a landlord, you are typically allowed access your units to inspect for repairs, so if you don't want to involved police, etc., and the tenants refuse access I would send them a certfied letter notifying them you plan to inspect the apartment for repairs on Oct. XX, 2009 at X:YZ time and follow through on that date.

Posted by: setancre at October 2, 2009 2:22 PM in response to Bad Smell from Tenant

I'm not sure about your rights in that case. I would probably consult a lawyer because unless this sitation is spelled out in your lease, there is going to be a lot of gray area and you will probably need to be aggressive to protect your right to quiet enjoyment of the home.

A lawyer could help you understand what you can expect and a letter from a lawyer would let your landlord know that you mean business and don't plan on being constantly inconvenienced. Obviously it is in the landlord's best interest to show the apartment as much as possible in order sell before the lease is up in 6 months, after which point he'll probably start to lose rent money on his investment. What's best for him with regards to selling the apartment, in this case, is completely at odds with what's best for you.

Posted by: setancre at October 2, 2009 12:22 PM in response to Right of Entry

This sounds like a tough situation. He's selling just your condo right? Your unit is not an apartment in a larger house?

Posted by: setancre at October 2, 2009 11:49 AM in response to Right of Entry

Are you talking about a broken lease? Meaning they stopped paying rent and moved out?

Posted by: setancre at October 1, 2009 12:27 PM in response to Non-Payment of Rent

Your formula is correct assuming that you paid the maintenance for all 12 months of 2008. Percentage deductability changes from year to year. Two reasons the deductability might have gone down are less mortgage interest (building refinanced at a much better rate since your original co-op unit purchase but didn't change the maintenance) or the building raised maintenance over the years to cover increased building expenses that outpaced any increase in mortgage interest or property tax cost (i.e., you added a doorman, or utilities rose significantly relative to the deductable costs).

Posted by: setancre at September 29, 2009 1:56 PM in response to Calculating Maint. Deductibility

Whenever someone starts talking about asbestos I'm reminded of 1993 when I was in high school here in NYC and the Mayor Dinkins/Board of Ed delayed the start of the school year until almost October to do "emergency" asbestos abatement in public schools across all 5 boros. They still weren't able to get everything abated and cleaned up in time at my school, and we returned to school in late Sept with plastic tarps taped over open holes in the walls, dust everywhere, exposed pipes, etc. Somehow the asbestos present for 50+ years, that millions of students and teachers were exposed to, became an emergency all of a sudden.

Mesothelioma is a form of lung cancer caused by years and years of exposure to airborne asbestos. There is an entire industry of lawyers (ambulance chasers) dedicated to asbestos litigation who have made a ton of money because of the identifiable correlation between asbestos and lung cancer. However, the most authoritative study of health effects of asbestos studied 100,000 men, of whom 17,800 all worked in the asbestos industry ("heavy occupational asbestos exposure"). It compared smoking cigarettes to asbestos exposure and found that cigarette smokers who didn't work in the asbestos industry were more than twice as likely to die from lung cancer as non-smokers who worked in the asbestos industry. In the study we are talking about people exposed to asbestos on a daily basis, as a career, before the gov't realized it was a dangerous fiber; not people who were incidentally exposed to it while doing work in their house. Yes, both smokers and asbestos workers faced a much higher risk of lung cancer than the control group (and considerably higher if they were exposed to both).

Point being, I personally would not be afraid of removing a 5" segment myself as long as I was wearing a mask, keeping it wet and bagging it carefully. Just as I would not be afraid of getting lung cancer if I smoked a single cigarette.

Posted by: setancre at September 25, 2009 12:55 PM in response to Asbestos That's Not a Ripoff?

Nitpicking, but based on where the foyer tile ends in the bedroom, I'm not sure you could put a door to the room and still fit a bed. Of course it's hard to tell because the pictures are all skewed to make everything look as spacious as possible. Also, the bathroom only being accessible through the bedroom is annoying, as is the lack of closet space.

Posted by: setancre at September 23, 2009 1:11 PM in response to Co-op of the Day: 8 Sidney Place, #5

You are required to return the deposit minus any damages and costs incurred for lost rent. If you received rent for June that was less than you would have received under the lease that they broke, you can deduct that amount from their deposit. For example: They paid $1500/month, the new tenant pays $1300/month and you had to fix $50 worth of damage to the apartment. If the deposit was $1500 then you are obligated to give them back $1250 after deducting for the damage ($50) and rent differential for June's rent ($250).

This article in NYTimes touches on this:

http://query.nytimes.com/gst/fullpage.html?res=940DE3D71F3CF937A25752C1A9629C8B63&scp=8&sq=lease%20mitigate&st=cse

Posted by: setancre at September 22, 2009 2:16 PM in response to Tenant Breaks Lease...

I was interested in seeing how much NYC-area spends on food/beverage/entertainment vs other parts of the country, but they didn't include it on the chart. I feel like that's easily my highest discretionary monthly expense. Weird categories... sporting goods?

Posted by: setancre at September 21, 2009 11:41 AM in response to Brooklyn, the Frugal City?

Agree that you should warn the shareholder that you plan to take legal action before starting proceedings. Hopefully that will be enough incentive for her to do something about the situation. It can be very expensive and time-consuming to try to evict a co-op shareholder. Here's an article specifically about criminal activity inside of apartments and it does mention that courts are generally more sensitive to the shareholder if it is the child/relative accused of criminal activity and not the shareholder.

http://www.habitatmag.com/publication_content/2009_julyaugust/featured_articles_from_our_print_magazine/criminal_activity_in_apartments

Lastly, since you seem sympathetic to her situation, you may want to consider that calling the police on her son may be much better for her family than evicting her from the co-op would be. If you evict, you will be foreclosing on her apartment (and since we are in a recession this is potentially at a significant financial loss to her). She would have to rent while waiting some type of equity payout from the sale of the unit which could take months/years (if she isn't upside-down on the mortgage). It may financially devastate her for years and years to come, whereas her son getting arrested a few times (if he is engaging in criminal activity) might give a little bit of a wake-up call.

Posted by: setancre at September 21, 2009 10:19 AM in response to Ignoring Coop rules

I believe, unless the mortgage is assumable (and very few are nowadays), that the bank cannot be forced to change the name/debtors on the loans. Even if you put the deed in his name, the mortgage company can still require that you fulfill the terms of the original loan. That is probably why the bank is telling you to refi, they don't want to transfer the loan to someone whose risk they haven't evaluated. By refinancing your brother would effectively be applying for the loan and they have an opportunity to verify his financials. If you think about it, if the banks allowed people to transfer loans between each other, than people who were underwater on their mortgage with good credit scores could transfer their loans (for $$) to someone who already had bad credit, and then allow it to default, in effect preventing themselves from getting a foreclosure ding on their credit report.

Also re gift tax, just conjecture, but I would question whether or not the gift tax is even triggered if you owe $200k on the property and it's appraised at say $210k at time of transfer. I'm not an accountant or lawyer but seems like the total equity "gift" transfer in that case is only $10k equity and gift tax exclusion limit is $13k this year.

Sort of a conundrum in that respect, because it seems like more equity in the property the better chance of being able to do a refi and get the loan in brother's name, but also more likelihood that you would have to pay gift tax.

Perhaps the route of having your brother just start paying the mortgage directly and claiming the deduction would be easiest. You just have to keep an eye on the statements and make sure he doesn't miss or make late payments.

Anyway, I would talk to an Oregon-based accountant and lawyer in if I were in your shoes.

Posted by: setancre at September 18, 2009 1:09 PM in response to Gifting House to Bro?

I would check Classic Tile on 86th St and 16th Ave. They have a pretty good selection of marble mosaic tiles.

Posted by: setancre at September 17, 2009 10:23 AM in response to 2" hex white carrara marble tile

We've used Steve Baranello and was very happy with his services (http://www.professionalpropertyinspection.com/), but if you go up to the search area on the top right of the page and flip the drop-down menu to Inspector you will see a lot of threads with recommended inspectors. I would definitely make sure you walk through the house with the inspector so you can ask questions. For me, doing the walk through is much more educational than the final report.

Posted by: setancre at September 17, 2009 10:06 AM in response to Starting to Consider a Reno

I think it might be a good idea to pay a home inspector to take a look at your house. It would cost about $500-$800 and they will walk you through the house and identify potential structural issues, mechanicals issues, roof life left, etc. Typically you do this prior to purchasing a home, but we (co-op board) have done it for our co-op building as a check-up on this building to anticipate future work needed. If you have a good inspector they can really highlight potential issues and help you prioritize your needs/wants/goals for the house.

Posted by: setancre at September 17, 2009 9:20 AM in response to Starting to Consider a Reno

If you're willing to take the R down to Bay Ridge, I love Lisa Giamarino at Curve Appeal. We have done late classes there. http://www.curveappealpilates.com/

Posted by: setancre at September 16, 2009 9:46 AM in response to Mat Pilates in Carroll Gardens?

Can't speak to prices in BH, but love that kitchen window.

Posted by: setancre at September 14, 2009 12:55 PM in response to Co-op of the Day: 57 Montague Street, #4A

I don't think (most) people are necessarily saying the shelves are ugly, they are just saying they wouldn't pay for them. I.e. you probably spent $30,000+ on shelving in your apartment to have it 100% what you wanted, whereas most people would have spent a total of $2,000-3,000 and gotten something 90% as nice. Someone wanting a luxurious sports car can either buy a $100k Porsche 911 or a $1.6 million Bugatti. You bought the Bugatti and most people who have the money to get either one still wouldn't bother with the Bugatti cause that last 10% of luxuriousness just isn't worth 10x the $$$. Unless of course that's their thing and they are really into sports cars... as I guess you are realllllly into shelves.

Posted by: setancre at September 13, 2009 6:32 PM in response to Atlas Shelving System for Sale

Question for FSBOs: how did you show the apartment/house, and was there any awkardness if you showed it yourself? And did you do any open houses? We are considering selling FSBO down the road as well.

Posted by: setancre at September 11, 2009 10:30 AM in response to FSBO or Not?

In our case the moldings had architectural detail original to the apartment and matched all the interior doors and windows throughout the unit. Unless we had new molding custom-milled, it wouldn't have matched. Patching was the most cost-effective solution for us considering that it was a 1-bedroom apartment, not a showpiece home. We preferred patched original molding to new, skimpier molding.

Posted by: setancre at September 10, 2009 3:07 PM in response to Help with Bathroom Vanity

In the co-op I purchased, the prior owner had done this to accomodate a too-deep vanity. When we renovated the bathroom we replaced the vanity (which unfortunately was a cheap, ugly particle board piece of junk) with something that fit the space better and had to fill in the notched molding (about a 2x1x1" notch). It was not too difficult to repair, but is still obvious where the molding was cut (I am sure a wood shop pro could've done a better job with the patch, but our contractor did his best). I would just say make sure you love the vanity, and it enhances the space, prior to notching the moldings, especially if they are original. The prior owner of our apt was cutting corners (literally) in all ways and it showed. If you don't love the new vanity, return it for something smaller.

Posted by: setancre at September 10, 2009 11:44 AM in response to Help with Bathroom Vanity

It seems like installing parquet flooring would be more difficult than installing regular tongue and groove hardwood. Are you confident his installer can do it correctly (i.e. are they floor guys or just handymen/laborers) even if you provide the strips? If I were in your shoes, I would have a full service company like Verrazano (not specifically recommending them) come in and give you a quote for cost to replace the wood and install (bundled). Depending on what he's paying his installers, ($x/day + $5 sq ft in wood) you could offer to pay the difference and have it done professionally by a one-stop-shop. Personally I would at least have a free estimate done for educational reasons and to pick the brains of the hardwood company a little bit. They will be much more familiar with this type of job than you, and could probably explain potential problems that come up, etc.

Posted by: setancre at September 10, 2009 11:15 AM in response to Help Matching Parquet

You may have trouble dealing directly with the bank because the condo being only 3 total units. They generally prefer to deal with 4+ unit condo buildings (I believe because of Freddie/Fannie risk parameters). Still, calling around a little bit will not hurt.

Posted by: setancre at September 9, 2009 1:58 PM in response to Advice on Mortgage Rate

Most of the time you can ask the bank/broker to give you a second preapproval letter for a lesser amount in this case.

Posted by: setancre at September 9, 2009 10:33 AM in response to Making an offer

To be fair (much as I dislike this house), if I'm not mistaken this whole block is on a hill, so most of the fortress-look is probably functioning as a retaining wall. Most houses here are set back further and have a steep grass front lawns instead, but that probably wouldn't work structurally once they tore down the original home, considering the gargantuan size of the new house.

Posted by: setancre at September 6, 2009 9:29 PM in response to Bay Ridge McMansion

My limited experience is that even with the best attorney, it can be very difficult to pin down a firm closing date. Often you think you have one and they still change the week of, or even the day before. Also, my understanding is that right now there is a big problem with banks getting mortgages processed in a timely manner and many, many last minute delays that are beyond the control of either the buyer or the seller.

That being said, you certainly deserve a response from your attorney. Some are better via email, some via phone, I would continue to leave messages until you have some response either way. Also, you may want to articulate that you are expecting communication even if there is no firm date yet. He may be waiting until he has info before responding to you.

Posted by: setancre at August 28, 2009 9:33 AM in response to Unresponsive Attorney

I'd tell your super/landlord to go to hell if he gives you a problem once the new roommate moves in. He is not a broker and is not entitled to a commission everytime someone moves in or out of the building. If he were charging you a small moving fee for freight elevator use or something like that (i.e. less than $100) and it was predetermined in the lease you signed before occupancy, then he might have some type of an argument.

All that being said, since he refuses to put anything in writing, he will probably not take you to housing court, but he sounds like the type that will try to make your life in the building very difficult. Good luck.

Posted by: setancre at August 19, 2009 11:03 AM in response to Landlord Problem

http://www.homedecorators.com has tons of rugs. You'd need to sift through them to find something you like, but they probably have 1000s of runners. Good luck!

Posted by: setancre at August 18, 2009 7:10 PM in response to Runners

Someone asked this question last year, you may want to check this post:

http://www.brownstoner.com/forum/archives/2008/09/closing_up_a_du.php#comments

Not sure if that thread really going to provide the info you need, other than highlight that it's somewhat complicated to do properly with the correct permits, fireproofing, etc. I've also heard about a problem with utility companies running wires (cable and phone) through the dumbwaiter shafts unbeknownst to tenants who then seal off the shafts causing a problem down the road.

Posted by: setancre at August 12, 2009 5:41 PM in response to Renovating a Bathroom

Check out the 2 produce stands on the corner of 77th and 5th Ave. They are way better than that one on 3rd you're talking about. Also there is a fish monger next door to them, between 76th and 77th on 5th, that I like for fresh fish and shrimp.

Posted by: setancre at August 12, 2009 10:18 AM in response to Just Moved to Bay Ridge

Correction: Alexandria is on Bay Ridge Ave (69th St) not 68th. Enjoy the new neighborhood. I moved to Bay Ridge 2 years ago and really love it.

Posted by: setancre at August 12, 2009 9:38 AM in response to Just Moved to Bay Ridge

"Warning: no place in Bay Ridge has a great wine list."

Try Petit Oven on Bay Ridge Ave (69th St) between 3rd and Ridge for a great wine list and seasonal tasting menu (French/nouveau American cuisine).

For pizza, I like Peppino's at 77th and 3rd Ave.

Beer and burgers, I like Yellow Hook grill as mentioned above, but I don't mind Salty Dog either (during the day/early evening it's better than late night).

Dry cleaner there's a little place I go to on 74th St between 3rd and 4th ave (closer to 3rd) that is cheap (relatively) and good. Name escapes me.

For a great tailor go to Alexandria on 68th between 3rd and Ridge. Little old greek lady who is extremely skilled and very reasonably priced (she did an amazing job on my wedding dress in only 2 fittings for $80, everyone else started at $350).

"Fancy" sushi I like Dish on 3rd Ave in the low 90s. It has a great little seating area in the back. For all you can eat sushi, I like Bay Ridge Sushi on 3rd and 68th. This place gets mixed reviews but I think it's great, fish is always fresh and the rice is nicely seasoned.

Weekend brunch I like Saint Germain on 3rd Ave around 83rd St.

Posted by: setancre at August 12, 2009 9:29 AM in response to Just Moved to Bay Ridge

serpentor, NYTimes has a great calculator for rent vs buy:

http://www.nytimes.com/2007/04/10/business/2007_BUYRENT_GRAPHIC.html?_r=1#

You can use the advance settings for maintenance/deductablility/tax bracket, etc...

Posted by: setancre at August 6, 2009 1:32 PM in response to Co-op of the Day: 27 South Portland Avenue, #3

Is there a reason why you have to have the lead test?

Unless I'm missing something, if it's an older apartment (like 30ys+), it seems easier to just assume you do have lead paint and proceed accordingly taking the proper precautions against ingesting it during renovations (i.e. don't take dry sandpaper to the walls, wear a mask when there's dust in the air, don't eat paint chips, etc.)

Posted by: setancre at July 31, 2009 1:36 PM in response to Lead Test

Although that's not exactly what you're supposed to do, it's pretty commonplace to do what you're describing. Is it a big building or a smaller landlord?

Bigger landlords will typically just go for this because it's less of a headache for them. In an up market they make money on this scenario, in a down market they don't usually lose much if anything (especially since many buildings are still rent stabilized and they can raise the rent a small percentage for the next tenant when the unit becomes vacant).

If your landlord is a homeowner in a 2-3 family house it's going to be a bigger deal for them to find someone to take over the lease. Theoretically you are on the hook for rent for the remainder of the lease if they are unable to find a new tenant in that time.

Posted by: setancre at July 31, 2009 10:39 AM in response to Breaking Lease to Buy?

If you're willing to head down to Bay Ridge, there are 1-bedroom apartments at your price point:

$199k
http://newyork.craigslist.org/brk/reo/1296997847.html

$209k
http://newyork.craigslist.org/brk/reb/1296630071.html

Posted by: setancre at July 30, 2009 1:10 PM in response to Condo/Coop

Agree with cmu. This is common in owner financing, they don't want to hold the note forever, and expect that in 5 years time you will be able to refinance with a regular bank since you have equity in the property (and better credit, if you currently have bad credit scores). Typically whenever you refi they get the balloon payment from the other bank.

Posted by: setancre at July 29, 2009 5:57 PM in response to What does this mean...

Recently used a local Bay Ridge painter named Michael who was recommended by our paint store. He did a nice job and the price was affordable. Sorry I don't have a last name. 347-830-1280

Posted by: setancre at July 29, 2009 5:33 PM in response to Looking for a Painter

My opinion would be to forget the pro-rated rent $2.15/per day difference that you are calculating. There are different ways of calcuating per diems (example: $2650/month x 12 months / 365 days in a year = $87.12 per day, regardless of whether it's July or February). They did you a favor allowing you to stay in the apartment for the extra ten days and it looks like they aren't trying to rip you off there.

As for the other items that they deducted $100, ask for that money back, explain that you paid for a cleaing service and the closet door has always been that way.

You said you lived there 2 1/2 years. Does that mean you asked to break the most recent 1-year lease? In that case I would be thankful to only come away with $100 penalty on a $2650 apartment, because they could have just as easily said No and made your life quite a bit more difficult.

Posted by: setancre at July 29, 2009 11:08 AM in response to Deposit Deduction?

If the ceiling of the basement is 2 feet below grade, and the DOB is not aware that there is currently a kitchen down there, I see very little chance for you getting it grandfathered in. Does the space have any windows at all? I'm trying to picture the ceiling being 2 feet below grade.

Posted by: setancre at July 23, 2009 8:41 AM in response to Cellar Kitchen Compliant?

Ashley, you nailed it right at the end. The landlord doesn't have to pay the fee, so why not use a broker? If they use a broker, they don't have to deal with the headache of posting ads everyday, emailing ppl back and forth, setting up meeting times and having ppl flake out at the last minute or be completely unqualified, running credit checks, etc. If you were a landlord and could either (a) not pay anything and have a broker take care of it all for you, or (b) not pay anything and have to deal with all the headache and time-wasting yourself, which would you choose?

If enough renters refuse to pay a broker fee and critical mass switches in the other direction, then things might change, but in the meantime, landlords are perfectly fine with the status quo. They are getting a valuable service for free, who wouldn't be ok with that?

Posted by: setancre at July 22, 2009 9:54 AM in response to Broker Necessary These Days?

Dylanfan, my kitchen renovation including all materials, cabinets, new appliances, stone counters and labor ended up costing $12,000 for 3x the amount of square footage of the bathroom. We could do a lot of that ourselves and replacing a dishwasher is a lot easier than replacing a bathtub. Finding a licensed and insured contractor (as our co-op required) to do a cramped, tiny bathroom for a low price is not as easy as you make it out to be. Most contractors have other jobs they'd rather take (maybe that has changed in recent months) and threw out numbers that really made it worth their while to deal with doing this small, tedious job. It ended up costing us about $17,000 for the bathroom (labor and materials included) which was just about 50% more than the much larger kitchen with the same quality of finishes (both very nice but not uber-high end).

As I said in my first response, if you don't need licensed and insured contractor of course the price will go down a lot. I don't think paying more guarantees better work and never implied that, I was just sharing my experience of how much things cost based on 5 real-life labor-only bathroom quotes I received less than a year ago.

Posted by: setancre at July 16, 2009 1:36 PM in response to Labor Cost for Bath Reno?

I think your responsibility ended at contacting the police. It is up to them to investigate your concerns and take proper action. It's not clear to me why a meth lab would "permanently contaminate" the building if it were dismantled back then, considering all the factories and toxic waste sites around Brooklyn that have been converted into "luxury" residential condos.

And considering this all transpired several years ago, you sound a little bit paranoid to me. If there are still smells coming from the apartment the current residents (assuming they have a sense of smell) realize this and can deal with it however they see fit. If people posted flyers at every location that there had ever been any chemical toxins in Brooklyn the whole borough would be covered in paper.

Posted by: setancre at July 16, 2009 9:59 AM in response to Crystal Meth Lab in Slope Bstone

We received 5 quotes between $10,000 and $28,000 for a much simpler 4' x 7' bathroom last Fall, no materials included. No heated anything, no steam shower, no glass, just a plain, simple (small) bathroom gut and replacement of tub, sink, toilet, recessed medicine cab, floor, walls, tile, paint.

Not sure what kind of quote you got but if it's anything south of $20,000 you are doing very well. I would probably expect somewhere between $15-$30k for the first bathroom. Glass is expensive for the steam shower, there is extra prep work involved in the shower walls to prevent mold (kerdi membrane behind the tile), etc. Not saying this is a "fair" price just what I would expect to be quoted if I was planning your project.

All above is assuming you use licensed and insured general contractor. Of course you can do it much cheaper using handymen, or skipping the GC and subbing out the job yourself if you have time and knowledge of the trades involved.

Posted by: setancre at July 16, 2009 9:38 AM in response to Labor Cost for Bath Reno?

@northridger: thanks for correcting my math - was having trouble multiplying by three this morning. I'm assuming the property in question is a landmark (most private residences that use deduction are), but I don't know. Still, landmark or not, if the numbers are correct that is a very high valuation for the exterior of the building.

Posted by: WBer at November 4, 2009 2:24 PM in response to Easement Audit Nightmare

@WBer...yeah. The problem the IRS is seeing is a $270,000 claim on a house appraised at $1.2MM. It seems a long stretch to prove to the IRS that the OP expected a $270K loss from the easement. A really, really long stretch.

It's impossible to say what the IRS valued the easement at without all the details, but if you apply some common sense SWAGs to what the penalties and interest might be, then a $145K bill implies that the IRS thought the loss in sale value of the home was pretty small, if not just plain zero. To do it right you'd have to figure out the taxes owed on $270K for that home owner....

Posted by: northridger at November 4, 2009 2:36 PM in response to Easement Audit Nightmare

"a program offered by an historic preservation organization"...ie not LPC? who?

Why does this sound unkosher to me...ie a dubious tax-shelter scheme?

Posted by: cmu at November 4, 2009 2:38 PM in response to Easement Audit Nightmare

It sounds unkosher because very few people would knowingly lower the real value of their home by $200,000 in order to take $200,000 in tax deductions (of which you would only get back maybe 30% or $60,000 on your taxes). Why give away $200k to get back $60k at tax time?

You would only "donate" $200,000 and take the deduction, if you knew it didn't actually lower the value of your home by as much as you are claiming it does. That's why the IRS is looking so hard at this, generally speaking, they know the donation probably didn't change the value of the house as much as is being claimed. Not that many people are preservation-minded enough to honestly donate away hundreds of thousands of dollars in real equity.

Posted by: setancre at November 4, 2009 2:52 PM in response to Easement Audit Nightmare

I attended a seminar on this topic a few years ago as well. I remember sitting in the room, listening to some guy in a bow tie describe the scheme, which basically goes like this-- you claim an easement agreeing not to change the facade of your building which, hello?, you know you would never do anyway. WHat? You were going to be vinyl siding on it but now you aren't?? Dress it up how you like with a lot of palaver about historic preservation, but I thought it was unethical then and I still do. Audits are awful. My sympathies. But this is a little like the Madoff victims who kept getting 12 % when everyone else was down and didn't want to inquire too closely.

Posted by: Cobblekrill at November 4, 2009 2:54 PM in response to Easement Audit Nightmare

@cmu - it is not a dubious tax-shelter scheme, it is a legitimate tax deduction. You are donating something of value to a non-for-profit (LPC is a government agency, not an historic preservation organization). There are some non-profits that have been established pretty much solely for accepting easements, and these organizations have raised red flags, but there are a lot of legitimate preservation organizations that hold easements as part of their larger preservation program (and by the way, I don't think HDC is one of them).

Posted by: WBer at November 4, 2009 3:00 PM in response to Easement Audit Nightmare

The HDC presentation did not sit well with me, but as you can see from their brochure, they claim to be qualified. Caveat emptor.

Posted by: vinca at November 4, 2009 3:12 PM in response to Easement Audit Nightmare

It's sorta like donating your junker car to a charitable organization and taking a tax deduction for the 5k blue book value of the car, even though the charity contracts with a company that tows away and sells the junker for $100 and gets 50 bucks out of the deal. I did that once before the IRS tightened up on that game. Now you can deduct the fair value of the donated car.

If you take a 270k deduction and when the change in value for adding the easement to the property in a landmarked district is de minimus, then I'd say a fair outcome is to argue you were not negligent, made some reasonable attempt to do the legal thing, and pay the tax you should have paid when you took the questionable deduction and try to negotiate the interest and penalties.

Posted by: Bklnite at November 4, 2009 3:18 PM in response to Easement Audit Nightmare

I just read the links that vinca provided, and the IRS one is chilling as it relates to this sort of case. The bulletin is:

"Internal Revenue Bulletin: 2004-28
July 12, 2004

Notice 2004-41
Charitable Contributions and Conservation Easements ".

Note that the bulletin is from 2004.

There's lots of talk about the intent behind the easements, and lots of technical terms, but near the end has the chilling paragraph:

"If the donor (or a related person) reasonably can expect to receive financial or economic benefits greater than those that will inure to the general public as a result of the donation of a conservation easement, no deduction is allowable. Section 1.170A-14(h)(3)(i). If the donation of a conservation easement has no material effect on the value of real property, or enhances rather than reduces the value of real property, no deduction is allowable. Section 1.170A-14(h)(3)(ii)."

Reading the whole document, it's pretty clear the intent of the deduction is to allow someone to deduct when they're making clear donations for conservation purposes that in some way contribute to the public good. For example, if the a rich family gave 20,000 acres of land to the NY/NJ trail conference for public use, they'd probably get a tax deduction for the full value of that land.

In the case of facades....the IRS wants you to show that what you're doing is in the public good, and that you're taking a material financial hit in doing so, and that the organization taking the easement is a true non-profit. If this is an LPC area than I'd say based on those rules you are SOL. If it's not LPC, then there's some wiggle room. But $270K still seems very, very excessive.

A question for vcthomas...did a tax attorney go over this deduction with you when you took it? Or did only the "historic preservation organization" help you out? Hopefully not just the latter. If you're taking any single deductions more than 10K or so it makes sense to have a tax attorney take a look at it. Not doing so just leaves you totally open to scammers and people's skirting the fringes of the IRS tolerance.

Posted by: northridger at November 4, 2009 3:30 PM in response to Easement Audit Nightmare

Ouch, it gets worse if you google it. Take a look here:

http://www.irs.gov/newsroom/article/0,,id=136337,00.html

The document, from 2005, shows that the IRS explicitly considers an easement on a home's facade in an area with a local historic preservation organization to be an invalid deduction. In fact, the article implicitly calls it a notorious tax scam. Here's the relevant bits...it's #9 on the "dirty dozen" scam list from 2005.

"IRS Announces the 2005 Dirty Dozen

IR-2005-19, Feb. 28, 2005

WASHINGTON — The Internal Revenue Service today unveiled its annual listing of notorious tax scams, the “Dirty Dozen,” reminding taxpayers to be wary of schemes that promise to eliminate taxes or otherwise sound too good to be true.

Abuse of Charitable Organizations and Deductions. The IRS has observed an increase in the use of tax-exempt organizations to improperly shield income or assets from taxation. This can occur, for example, when a taxpayer moves assets or income to a tax-exempt supporting organization or donor-advised fund but maintains control over the assets or income, thereby obtaining a tax deduction without transferring a commensurate benefit to charity. A “contribution” of a historic facade easement to a tax-exempt conservation organization is another example. In many cases, local historic preservation laws already prohibit alteration of the home’s facade, making the contributed easement superfluous. Even if the facade could be altered, the deduction claimed for the easement contribution may far exceed the easement’s impact on the value of the property."

Posted by: northridger at November 4, 2009 3:40 PM in response to Easement Audit Nightmare