In mid-2017, I sold my San Francisco rental property for 30X annual gross rent and reinvested $500,000 of the proceeds in real estate crowdfunding. I’m leveraging technology to invest in lower valuation properties with higher net rental yields in the heartland of America. With the new tax policy starting in 2018 capping state income and property tax deductions to $10,000 and limiting interest deduction on mortgages of only $750,000 from $1,000,000, expensive coastal city real estate markets should soften at the expense of non-coastal city real estate.

3. Travel Resulting From Rental Activity: Far too many passive income investors are not aware of the tax deductions that extend beyond the physical upkeep of a property. Having said that, it is entirely possible to deduct the amount of money you spend traveling for the sake of running and maintaining the property. Anywhere you drive for the sake of the rental, which includes visits to the property itself, can mount to travel expenses. Most notably, you can deduct the actual expenses incurred while traveling (gas, upkeep, repairs, etc). To clarify, travel expenses must be common, helpful, appropriate for your rental activity and — above all else — be solely for rental activities. Much like the repairs made on a property, deductions resulting from travel costs must be made in the same year they were incurred.
Mike, I don’t consider the income from FS to be passive, as I’m spending time commenting to you right now. But since 75% of my traffic comes from search, the most traffic I would probably lose is 25% for probably a year. And then my search word rankings would probably slowly fade given frequency of posting new content is one of the search algo variables.

The reason I consider dividends artificial and believe they don’t matter is because you can just as easily reinvest your dividends. If a stock is worth $100/share, I don’t care if it issues a $1/share dividend or if the share price instead increases to $101/share – either way, I have the same amount of money, because there’s no difference to my net worth whether I take the dividend or sell part of a stock.
The much loved model for bloggers and content creators everywhere and for a good reason…it’s pretty easy to write a 60-80 page ebook, not hard to sell say $500 worth a month through online networking, guest posting and your own SEO optimized blog, and well you get to keep a large whack of the pie after paying affiliates.  Hells yeah!  Continue reading >

Some retirees start consulting businesses, do handy-man work, or in some other way become self-employed. Many are caught off guard by the payroll/FICA tax and can get behind on taxes once they become self-employed. If you become self-employed be sure to work with a good tax professional who can help you calculate the right amount of payroll tax to send in, otherwise April 15th will be a very unpleasant time of year for you. 
One of his favorite tools is Personal Capital, which enables him to manage his finances in just 15-minutes each month. If you sign up and link up an investment account with $1,000+ within 40 days, you get a $20 Amazon gift card. They also offer financial planning, such as a Retirement Planning Tool that can tell you if you're on track to retire when you want. It's free.
If you don’t want to write the book yourself, you can also hire a ghostwriter through various online sites like Upwork, Freelancer.com etc. writing is the best passive income ideas for 2018. See my Kindle Direct Publishing Portfolio HERE. Selling your eBook can be a great way to earn passive income forever once it’s released. You need to take significant time to make sure it is high-quality. Also, you will need to spend time promoting your eBook.
Unfortunately, I can’t answer that conclusively one way or the other. It all depends on you, what you like to do, your work ethic, personality, etc. If you are a good writer perhaps you could write a book and make money that way. Or, you could start your own website and do affiliate marketing. Just because you are young it doesn’t mean you can’t make money doing at least a few of these ideas. I wish you luck in your money making efforts!
Finally, I imagine the biggest debate with my ranking is Creating Your Own Product as the #1 passive income source. If most people have never created their own product, then it’s easy to give it a thumbs down. There won’t be much complaint about Private Equity Investing being in last place because most people are not accredited investors. But given I believe that plenty of people can create their own product if they try, pushback is inevitable because a lot of people simply don’t try!
Let’s say a company earns $1 a share and pays out 75 cents in the form of a dividend. That’s a 75% dividend payout ratio. Let’s say the next year the company earns $2 a share and pays out $1 in the form of dividends. Although the dividend payout ratio declines to 50%, due the company wanting to spend more CAPEX on expansion, at least the absolute dividend amount increases.
First, ask yourself if your app idea is feasible. Will it make money? This information is completely free and available on every single app store. Browse the “Top Grossing” section of any category. Check the rankings. These rankings show you the market demand. It’s not rocket science, but this isn’t the first step that most people take. Do you already see your app idea? Don’t be discouraged if you do. This is the best way to see and know if that idea is making money. If your app idea is ranked in the top grossing, even better. Do you see less than 5 version of that app idea? Then you have a good shot in this market!
If the result is net income, don’t enter any of the income or losses from the activity or property on Form 8582 or its worksheets. Instead, enter income or losses on the form and schedules you normally use. However, see Significant Participation Passive Activities , later, if the activity is a significant participation passive activity and you also have a net loss from a different significant participation passive activity.
If an investor puts $500,000 into a candy store with the agreement that the owners would pay the investor a percentage of earnings, that would be considered passive income as long as the investor does not participate in the operation of the business in any meaningful way other than placing the investment. The IRS states, however, that if the investor did help manage the company with the owners, the investor's income could be seen as active since the investor provided "material participation." 
When I did her recent tax return she had $45,000 in passive losses from the rentals and $35,000 in income from her S-Corporation. I called her and found out how many hours she had only worked for three months in her S-Corp, which was less than 500/750 hours per year.  I changed the nature of the income from the S-Corporation to passive, thereby eating up the passive losses from the rental. 
Sharon, you missed my point completely. If you feel you need $8000/month to live the life you want, and you get that $8000/month through passive income, you may feel financially free for a few months. However, next year, you’re not going to be wanting $8000/month + 3% inflation; you’re going to be wanting $16,000/month. This is greed 101. It’s normal. It’s natural.
When it comes to taxation, there is the possibility of writing passive income off as a deduction if you record a loss. Keep in mind though that you can still get taxed on passive income. You will also have to make sure you follow the IRS’ requirements for passive income. If they deem that you’re too materially involved with the project, you’ll see a bigger tax bill.
I have already come up with 50 ways that a management company can screw you for profit without you ever knowing(or not finding out for awhile). Did you have an inspection before you made an offer on the property? Do you have a picture of the property you bought? How do you know if that picture shows the house you actually own? or if it even hows the ‘current’ state of the house you own?
According to Uncle Sam, you need to be "materially involved" in an enterprise to earn active income. With passive income, it's just the opposite, as the IRS deems you to be earning passive income if you're not materially involved with a profit-making enterprise. By and large, expect income to be taxable if you are engaged in a passive income enterprise. You will need to report earnings to the IRS.
For purposes of item (1), above, an item of deduction arises in the taxable year in which the item would be allowable as a deduction under the taxpayer's method of accounting if taxable income for all taxable years were determined without regard to the passive activity rules and without regard to the basis, excess farm loss, and at-risk limits. See Coordination with other limitations on deductions that apply before the passive activity rules , later.

If you don’t want to write the book yourself, you can also hire a ghostwriter through various online sites like Upwork, Freelancer.com etc. writing is the best passive income ideas for 2018. See my Kindle Direct Publishing Portfolio HERE. Selling your eBook can be a great way to earn passive income forever once it’s released. You need to take significant time to make sure it is high-quality. Also, you will need to spend time promoting your eBook.
5. Make sure you are properly diversified. Capital preservation is underrated. We saw a lost decade for tech stocks between 2000 and 2010 after the first dot-com bubble burst. It actually took 13 years for Nasdaq investors to get back to even. Investors in the Borsa Istanbul stock market index just gave up 10 years' worth of gains after they saw a plunge in their currency, partially due to increased tariffs by the US and a lack of confidence in the government. Your passive income needs to be properly diversified in order to take the hits.
But, you don't need to go further than that. You can simply write it and publish it and collect the income. That's all. Send out a couple emails to your list (if you have one) or post it on social media, and there you have it. Passive income. Now, the amount of income you receive depends on the quality of the book you've written. How well did you craft the message? How targeted was the information to your audience? It counts.
Passive income is the concept of developing an income stream that can last into perpetuity with limited ongoing work. Passive income does not come without hard work. Do not let the word ‘passive’ fool you because it takes significant work. However, if you do it right upfront you will reap significant benefits over the long-term. Track your passive income with Personal Capital.
Lending Club went public in 2014 and is now worth about $1.7B. They advertise P2P lending returns of over 7% for well-diversified portfolios of over 100 notes. I’ve personally been able to achieve a 7.4% annual return over the past two years in a completely passive way by investing in A and AA notes. Others have achieved a 10% annual return through relatively minimum effort.

What I like about p2p investing on Lending Club is the website’s automated investing tool. You pick the criteria for loans in which you want to invest and the program does the rest. It will look for loans every day that meet those factors and automatically invest your money. It’s important because you’re collecting money on your loan investments every day so you want that money reinvested as soon as possible.
I have only dabbled in drop-shipping before when I had an eCommerce platform 6 years ago or so. I think it is something that you could do on the side, but you would want to do in depth research on the industry you want to get into before setting up shop. It may be a little less passive up front, but over time you could take your hands off the wheel.
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