Ground Breaking Soon

[kodydog]

The only impact fees in High Springs are for water and sewage. High Springs added public sewage about ten years ago. When they did they decided to put a grinder at each and every customer. The grinder system runs about $5000. High Springs is still recovering from this fincial burden.

At one point in our venture we considered buying a commercial lot and building on it. The impact fee for commercial  runs about $10,000. Sock it to the business owner, right? Impact fees are BS. That and taxes and insurance put that idea out of our price range. Not to mention commercial property prices are in a sellers market now. And I don't see that trend ending anytime soon.

So we are doing the next best thing and are building on the lot next door. It will not be considered commercial property as long as we call it an "accessory building." Their words not mine. We will not have water or sewage in this building so no impact fee. And because we combined the two properties we can use the bathroom in our house.

Are you considering building on this property? If you are I'm not sure you want employees using your bathroom. I have a story about an upholsterer friend of mine who did this. It didn't turn out good.

But yes join the properties and your lot next door will reap the benefits of homestead exemption tax. I don't know what difference this will make on your tax bill but every little bit helps. We did the same when we lived in Suwanee County.

[baileyuph]

Taxes on a venture like this - question:

There officially is no business activity then, there will not be a business tax on the real
estate, then along with that - No business deductions (related to real estate)!

This type of arrangement could get complex with a home owner's insurance policy, especially if ............there is an accident due to a literal business activity.

A tax return cannot claim depreciation on a building not declared commercial.

Mojo might have some insight to these type questions?

Doyle



 

[kodydog]

For our federal income tax we can deduct everything that is business related. Including our van, our home office and our new building. We have been doing this for years. The fed doesn't care what the property is zoned. That is more of a local thing. We have been to the zoning department so many time they know us by name. We're trying to do this "mostly" legally without having to spend a fortune for commercial real estate and all the other charges they have for a business. The only local tax we pay is for our business license. And we pay local residential property tax. 

Insurance for a home based business is always a problem. When you tell them upholstery shop they think refinishing and junk cars sitting out in the yard. But Rose did find one who insures us. 

[Mojo]

Ed:

We have yet to make plans. If I build next door it wont be for our business but rather a hideaway / woodshop for me. It would be a private workshop.

We have yet to make a decision as to what we are going to do. We moved to a 1,600 sq ft building and have outgrown it already. We have 3 plans we are considering - 1.) Move to a new building in Virginia, train my daughter on the business and let her take it over so we can start relaxing a bit more. 2.) Buy a building in Brooksville. 3.) Buy a building in Gainesville. I know one thing, I am done renting. I hate renting as I do nothing but build equity for someone else rather then ourselves.

We are not sure what we want to do. We are at another crossroads with both companies. After the last fiasco with our former manager neither of us are keen on bringing in someone outside to run the companies. I would like to get my daughter involved as she is amazing at running companies and extremely smart. She is a go getter and workaholic and very outgoing. She would be a perfect fit. But I am not going to shove this business onto her if her heart isn't in it. We are flying her down here this fall so she can spend some time working with us to see if she likes the business.

We will need to make a decision in the next 12 months.

Chris

[kodydog]

I hate paying rent also. To me it's like throwing money away.

From your description it sounds like the daughter thing is a good idea.

My opinion, I would stay away from Virginia. Income tax and other business taxes make it unfriendly for business. .

Just wondering, why Gainesville? Taxes here are one of the highest in the state. But what can I say, here I am. You know I would help you any way I could. Bosshardt Reality has a good commercial page on their web site. They not only list their properties but most other realtors also.

http://commercial.bosshardtrealty.com/listings/?searchtype=commercialforsale&type=IND&pricelow=100000&pricehigh=600000&sqft=all&city=all

[Mojo]

I am not crazy about VA's personal property tax. My son paid an annual fee of $ 2,500 just for his coach.

Gainesville, Ocala, Wildwood, Lake City, somewhere above the turnpike split to catch I-95 connecting to I-75 via the turnpike. Customers seem to head that way a great deal. I wanted that central location in the event that we expand and go into RV service work.

We got back logged recently and hired our next door neighbor to cut fabric. She is amazing, a Romanian immigrant and typical European woman. Tough as nails and extremely hard working. But she is our age and does not want full time work. We hired a friend for the summer who is going through the police academy and he will be gone this fall. We lost our former book keeper to the police academy as well. She graduated and got hired as a deputy and moved on.

I think what brought all of this on is we had a meeting with Miami's CEO who is a friend of ours. He has been a business consultant and confidant to us for the past few years and he said " have you planned for the succession of your business or the sale of your company ? " That really got us thinking. So we are trying to make a move now for the future so we are positioned correctly. To be honest I am not looking forward to moving.

Speaking of moving, I had a meeting the other day with a buddy of mine who owns a steel fabrication company. He bought a new building a couple years ago and had to hire professional industrial movers. He told me his moving bill was $ 250,000. I damn near died. I no longer bitch about the cost of parts or machines when he told me one of his CNC machines cost $ 750 K and a part broke recently that cost $ 14 K. Talking about overhead. Yowzers.

It typically takes me a long time to make major decisions like this. I structure everything on paper and then pass on my plans to several friends who I consider brilliant business minds and are highly successful and then let them find the holes and flaws in my decision before making a move on something. I then gather their input and with my own plans allow my son to make the final decision. He has one amazing analytical business mind. This is going to be one of those decisions.

I have no qualms passing things by others and getting their input. I have seen to many ego maniac business owners make poor decisions that cost them dearly in the end. A smart business person will use all the resources he has available to him.

Chris

[kodydog]

We submitted request for estimates to 5 builders. Two came back about $10k more than expected. Two others never came through with the estimate. The fifth we met today. He came by to check out the lot. His estimate was very reasonable. He comes with a good recommendation from a neighbor. And he is local. He satisfied all my questions and is working up a solid price. We're excited. 

[Mojo]

Wishing you the best Ed. Please keep us informed on ow the building project goes.

Chris

[kodydog]

Spent all day Saturday digging out bushes, trimming trees and cutting down one large tree. My neighbor must have felt sorry for me when he came over and helped drag it all to the curb. Last week I ran power to a couple of outlets the construction crew will use. This all on top of two large trees we had a professional cut and haul off. Only thing left is to move and rebuild a small mower shed that is about half falling down.

The contractor is supposed to work up a final estimate this week.

[kodydog]

Need suggestions y'all. The contractor came in with a final bid and it is a go. We sign on the dotted line Monday. He will do everything except finishing the walls on the inside. We will do this ourselves. We're trying to save a little money.

We are thinking about using 1/2" or 5/8" Drywall. A 4' X 8' sheet is between $9 and $13. I would like to hear some cheaper and maybe even better ideas that have worked for you.

[MinUph]

Sheetrock is probably the least expensive wall. 1/2" is the norm. 5/8 is fore rated and used between building to slow the fire down. You could use 1/2" on the complete building if it is just one shop. What else is there for 9 bucks? Paneling is to thin to use by itself. Rock is easy to install and finish.

[sofadoc]

He will do everything except finishing the walls on the inside. We will do this ourselves. We're trying to save a little money.

Out of curiousity, how much are you saving by doing your own drywall?

[SteveA]

Ed I tried to open your photo above and Photobucket said it's not allowing 3rd party hoisting without a subscription - what's that about - no more freebies ?
SA

[kodydog]

Out of curiousity, how much are you saving by doing your own drywall?

It was right around $3500. The builder said his guy is good but not cheap. I imagine a crew of 3 guys could knock it out in 1 day. It'll probably take me 5. I'm not sure how much Rose can help. Its real tempting to let him do it but we are getting close to our budget and I still have to build work benches, buy 2 wall mounted air conditioners and paint for the exterior. When the building is done we will build a privacy fence around the whole thing.

Ed I tried to open your photo above and Photobucket said it's not allowing 3rd party hoisting without a subscription - what's that about - no more freebies ?
SA

Photo bucket drives me nuts. I need to check out some of those other sites that were suggested in another post. I'm not sure whats going on, I don't subscribe and am able to navigate through Photo Bucket. My profile picture for this site stopped working about 6 months ago. I've got a feeling Photo Bucket has something to do with it.

[kodydog]

Sheetrock is probably the least expensive wall. 1/2" is the norm. 5/8 is fore rated and used between building to slow the fire down. You could use 1/2" on the complete building if it is just one shop. What else is there for 9 bucks? Paneling is to thin to use by itself. Rock is easy to install and finish.

Thanks Paul here is another question. The first 4' could be sheetrock and the second 4' peg board. Does peg board have to have sheetrock behind it? Can I just screw it to the studs? Lowes has 4 X 8 pegboard for $10.