@SmallBusinessSurvivor wrote:
1. Setup a LLC to handle everything below
2. Invest 10% of the money upfront and take a 90% loan from the bank at say 7% (e.g. 30k investment and 270k loan) which is invested in heavy construction equipment
4. Use the depreciation losses to offset any W2 income, then pay taxes on the rental income less the loan interest every year thereafter and make 12-14% returns on your investment
They claim it's totally legit.
Besides that it could be a passive activity, which would NOT allow you to use the first-year losses, there are some other things that could be concerning.
If they tell you to set up an LLC without saying why, that is a 'red flag'.
If they are telling you to take a loan (rather than merely mentioning that could be an option), that might be a red flag. Even more so if they push you to get a loan through them.
You If they are 'promising' 12%-14%, that would be a major red flag. It could be fine if they say you "could" earn that though.
