The Small Advantage model gives you the chance to own a “portable home” while leveraging your investment for a 4x tax-weighted return in the first year, totaling 5x over the entire depreciation period. This happens thanks to the home’s eligibility for first-year bonus depreciation. Here’s how it works: A business forms an LLC and invests $60,000 as a down payment on a portable home. The remaining $240,000 per unit is paid from future cash flows via a cash-flow buyout lease.

Under current tax rules, the financier can claim a first-year bonus depreciation of $230,400 (64% of the asset’s basis), with the rest deductible over the next four years—adding up to a 5x deduction ratio. Since portable homes qualify as personal property (not real estate), you can take advantage of this bonus depreciation. The result? Big tax savings and a boosted ROI.

Bonus Depreciation: You have two choices for bonus depreciation treatment: Section 179 or Section 168K.

Section 168(k): Allows a first-year depreciation deduction equal to 64% of the asset’s adjusted basis in 2024. The remaining basis depreciates over the next four years at 9% each year.

Section 179: Allows 100% first-year depreciation (with a max deduction of $1,160,000), making it a powerful option for immediate tax savings. The full face value of the note receivable for the portable home counts as its depreciable basis, giving you maximum tax benefits upfront.

3rd Party Property Manager: A landowner or portable home dweller who wants to expand their living space or start a rental business with no money down. They lease the home for $798 a month over 30 years.

The Taxpayer/Business: An LLC purchases the portable home with a $60,000 down payment, with the remaining $240,000 paid to a lender over time.

The Manufacturer: We work with manufacturers to sell the portable home on monthly payment terms. The lender collects the remaining purchase price through the lease, without a personal guarantee from the financier.

Deduction Benefits: There’s no limit to the amount of bonus depreciation you can deduct. If the depreciation creates a net operating loss, you can carry that loss back to offset previous income, or forward to offset future income. Bonus depreciation can be used for both rental and trade activities, giving you flexibility in how you apply it.

Timing: To claim the full 64% bonus depreciation on your 2024 taxes, the portable home must be placed in service by 2024. Orders and deposits should be submitted by August 31, 2024.

Advantages: This model generates significant tax deductions while allowing you to make a profit from a fully secured cash outlay. The 4x tax-weighted return in the first year, combined with an additional 1x over the next four years, makes this a strong investment strategy.

Steps:
1. Form an LLC and fund it based on the number of portable homes being purchased.
2. The LLC purchases the home(s) using the funds as a down payment.
3. We arrange for a 3rd party to lease the home to a property manager, landowner, or business opportunity seeker.
4. The LLC receives the first-year bonus depreciation deduction of $230,400, offsetting income through 2028. 5. The LLC passes the bonus depreciation benefits to you as the individual.

With the Small Advantage model, you’ll enjoy substantial tax deductions and potential profits on a fully secured investment. The 4x tax-weighted return in the first year is a major advantage, with additional returns over the next four years. Ready to take advantage? Let’s make it happen—book your consultation now!