How can I extort my landlord?

In My Humble Opinion
1

How’s that for an inflammatory title? :slight_smile:

A few months ago, I found a new house to rent. The landlord initially wanted us to go month-to-month, since he had just bought a new house, and wanted to sell this house “in a little bit”. I’d just been forced to move out of my previous place, since those landlords wanted to move into it… so I asked for a six-month lease. He agreed to that. He also initially asked me to get my own PO box, since he wanted to maintain residency at the house I’d be renting. I told him that was unacceptable, so he settled for keeping his mailing address at this house… so I still get all of his mail.

Why? 'Cause he’ll get hit with a huge tax penalty because he didn’t live in this house long enough, and he’ll be making a huge profit when he sells it.

I also put down one month’s rent as a deposit.

I just recently sold my house in Austin, so I’m in the process of looking for a house to buy here. I approached my landlord and asked him if he was still willing to sell the house- I like the place, and it’d be convenient to not have to move so soon. He told me that he’d changed his mind- he felt like house prices were going to keep rising, so he wanted to hold onto it so he could get as much money as possible… but if I really wanted, I could make an offer. :rolleyes:

I passed, and started looking elsewhere. I put in a bid on a place, but they wanted me to close ASAP (houses go really, really fast in this town- some within hours). I went to my landlord and asked if he wouldn’t mind if I moved out next month. He insists on sticking to the letter of the lease, which would end up forcing me to pay for two places 'til the lease runs out (unless some new tenants can be found).

This irritates me to no end. Soo… my question is… how can I ever-so-tactfully mention that I know that he’s:
A) Trying to avoid the capital gains tax by fraudulently maintaining “residency” in a house that he’s not actually, you know, living in,
and
B) Since he’s maintaining residency in the house that I’m renting from him, it’s very unlikely that he’s reporting the tax on my rental payments?

Optimally, I’d like to get my deposit back (since there’s no damage, and the place is spotless). Less than optimal would be just not having to pay rent for the rest of the lease (once I move out). It’s unlikely that I’ll have more than two-month’s overlap… but that’s still a huge chunk o’ change for me.

It seems to me that he really wouldn’t want this rental arrangement to see the light of day. Mind you, I don’t think I have any intention of actually doing this- I just want him to think that I’m willing to do it. I need a tactful way of telling him that I know he’s doing something illegal, and that if he raises a stink about me moving out, he’d be screwing himself over.

2

I work in rental property management, but in New Jersey.

The first thing you have to find out is whether the City you are in requires any paper work for renting a property and if your landlord filed it. In my fair city, there’s a Fire Preventional Dept that keeps track of how many people are living in every building, and a Rent Board that keeps track of who is renting and for how much. If your landlord hasn’t filed the required papers, he is renting to you illegally, the burden is on his ass (tenants can claim the landlord said it was a legal rental), and the City might tell the landlord he has to let you stay free to a number of months and even that he has to give you the money to move and reimburse all rent monies!

Most Cities frown on illegal rentals.

3

Tactful… How about “I’m leaving next month, please apply my deposit to the last month’s rent.”

What is he going to do, take you to court? File with the credit bureaus? Have you evicted? Now, you have to be 100% sure that he can’t let this rental thing get out. You will get your nuts stomped if he doesn’t actually care about that. Another option is to sublet, check your local laws about your rights to sublet.

Put the lease in a safe deposit box somewhere first.

4

First of all, you seem to be wanting to have the cake and eat it too. I mean, YOU were the one who insisted on the six month lease, and now you are bitching because you are stuck in a six month lease. Ahem…can you see the landlord’s point of view here?

I think the best approach is one of honesty. Does he know you have a new place and will be stuck with two monthly payments? Perhaps you can work out a deal…offer to pay two months to get out, assuming no once can be found to take it over beforehand. Or offer to pay for some ads in the local paper to find new tenants.

Sure, you could play hardball and maybe use the threats and get out of the lease, but I personally have found it to be advantageous not to burn bridges, and I also believe in karma - so I would try to find a happy compromise.

Just my humble opinion.

Oh, and congrats on the house - hope this all works out, for both you and your landlord.

5

Why does it “irritate you no end” to hold up your end of the deal you insisted on? You may be able to cheat him out of a month or two of rent by kinda-sorta threatening him, but that’s pretty unethical behavior on your part relative to the deal you struck, regardless of his tax issues.

6

Stop paying rent, put the whole thing out of your head, move into your new place, and let him take you to court - if he dares.

Who cares about “burning a bridge” built by an exploitative crook?

7

You signed a contract and your land lord is holding you to it. Suck it up and pay up.

8

I’m a landlord.
Let me assure you that if there’s a good market for buying there’s a good market for re-renting.
Don’t be such a wimp. Put an ad on Craig’s list and get it over with.

9

Well, if the contract isn’t actually enforceable in a court of law, that pretty much invalidates it.

10

Um…if he wants to…yes.

Are you smoking crack? “If he dares”? If he dares to do what? Sue Lightnin’ for his financial obligation for breaking the lease?

Look. Here’s the deal. Lightnin’ agreed to a six month lease. He/she is about halfway done with it from what I can tell. Since the landlord is apparently exercising his right to have Lightnin’ fullfill his end of the legal contract he signed, he has a couple options:

  1. Pay the rest of the rent
  2. Move out and don’t pay the rent and hope it’s not worth the landlords trouble to sue you. If you do this, I would be smart about it. Tell the landlord you are vacating the apartment in 30 days and pay up until the point you move out (minus your deposit which by the way is illegal to use as rent in some states). At least that way your landlord will be able to look for another tenant.

Asking how to “extort your landlord” makes you look like a petty self-centered jackass especially since legally he is in within his rights and and “illegal” activity is pure speculation on your part.

By the way, people don’t like being extorted. And as your landlord, I think he can probably devise at least as many ways to legally fuck with you as you with him.

11

True, but Landlord is trying to get out of tens of thousands of dollars in taxes, where Lightnin’ is, at most, trying to get out of 2 months of rent, which Landlord may not even lose a penny of if he re-rents the apartment promptly.

The fact that Landlord is attempting to defraud the government is why it’s very possible that he won’t use the government’s authority to enforce the contract. This is the sort of thing you risk when you get into tax fraud.

If Lightnin’ wanted to be a stand-up guy, and law abiding citizen, he’d pay his 2 months rent, and turn in Landlord to the authorities. By walking out and telling Landlord to get bent, Lightnin’ gives him the option of not being turned in, which he is free to take or not take at his discretion. Like I said, though, if Landord pursues the rent, Lightnin’ will lose, that’s the risk he’ takes when he tries to break his lease.

12

First off, you really shouldn’t have insisted on the lease. But oh, well. My guess is that the landlord would not be bothering with the tax evasion if it wasn’t really worth it. We are likely talking tens of thousands of dollars. NO ONE wants to deal with the IRS. I would write a letter offering 30 days notice (deposit to be applied as rent for that month.) If he says anything about it, says he is going to take you to court over it (which he won’t–no one wants to deal with that either, unless he’s a lawyer…he isn’t, is he?) simply tell him that the IRS might be interested in your arangement. I wouldn’t threaten this unless he threatens you with court first, but he is the one breaking a big law here, and if he is doing this who knows what other tax evasions he might be involved in. Like another poster said, if the housing market is that good, so is the rental market. It will be much easier for him to re-rent the place than to take you to court.

13

If the landlord is in fact doing what Lightnin’ says he is. And I’m not so sure that he is just based on Lightnin’ s say so. Lightnin’ could just as easily be trying to paint his landlord as a crook in order to get our sympathy, thinking we would automatically assume a Doper to be more honest than a stranger.

14

Well, if he does that, he deserves the outcome of whatever lousy advice he gets.

15

Gee, thanks. Love you too.

I don’t really want, or need, sympathy on this. I’m asking for advice. And you know, I thought I’d made it kind of clear that I don’t like the entire situation, and am trying to get out of it in the easiest way. I actually would prefer that he realize that he’s already making out like a bandit, and just tear up the lease.

The facts are-

  1. He’s kept the rental house as his mailing address in order to keep the IRS from knowing that he’s bought a new place, so that he can avoid having to pay taxes on what will be a HUGE profit when he sells the place. Originally, (after I signed the lease, actually), he wanted me to get a PO Box out of my own pocket. I said that I didn’t want to do that, so he still uses my mailbox as his own- I have to go through the mail every day and make sure that I leave his mail in there when I get my own. The other side of this is that HE goes through MY mail, as well. This one I know is true- he’s told me.

  2. Since he still “technically” lives in the rental house, I seriously doubt that he’s reporting my rent to the IRS. In other words, he’s defrauding them again. This is conjecture on my part, but I think it’s a safe bet, don’t you?

  3. I signed a lease, yes. I’d actually insisted on it. When I first talked to him, he said that he wanted to sell the house “in a few months”, and wanted me to go month-to-month. I’d just been forced to move from a rental house for this very same reason, and I didn’t want to go through it again, so I asked for a minimal lease. He asked me if I’d be interested in buying the place in a few months, and I was. However, now that I’m willing to buy the house, he says he wants to wait “a year or so”- because house prices are still rocketing up. “Sure, I’ll sell the house to you, Lightnin’… as soon as I’m sure I can get just as much money as possible from you. In the meantime, help me defray the costs of my mortgage on the two houses I’m living in, would you?”

Frankly, if the guy was willing to sell it to me at the end of the lease, I’d be up for that, even though I’d be losing money- house prices are going up an average of 6K/month 'round these parts. He’s not, though- he wants to hold onto the house to see how high the prices are going to go. I can’t really blame him for this- it’s his house, and he’d be a fool to give it away if he can hold onto it and get more money later on. I don’t feel I should have to give him even more money, though, at my own expense. I’m effectively losing almost 5K/month in this situation. Assuming I find a place (I have to make a decision this afternoon), there will be 2-3 months of overlap where I’ll have to pay mortgage and rent- and I can’t afford to do that.

So on the one hand, we’ve got me with three months left on a lease, and losing five thousand dollars a month (maybe a bit less, depending on when, exactly, I take possession of a house). On the other hand, we’ve got the landlord defrauding the IRS.

There’s no way I can prove that this is an accurate portrayal of the events, of course. Not that I would lie about it, though- since I’m asking for advice on how to gently remind the landlord that he’s the one breaking the law, and I know it, I’d say that I’m probably telling the truth.

16

You could always push the closing back as long as possible - it sounds like you’ve got two months left on your lease. Is that the case? So you push the closing out a month, and use the other month to prep your new place and take your time moving in.

17

That’s actually what I’m hoping to do, now. The first house I bid on, the sellers wanted me to move in as fast as possible, which is what prompted this thread. The inspection on that place convinced me to retract my bid, though- and the new place I’m looking at isn’t on such an accelerated timetable. There could still be some overlap, though.

18

Your asking for advise on how to get away with breaking your lease. Your attitude is that you feel that because your landlord has some shady dealings you are justified in trying to screw him.

The best advise you are going to get is to just move out and hope that he is not willing to go through the time and expense to pursue the matter and that he doesn’t want any undue attention to his finances.

Also, is he in fact breaking the law? Do you specificly have to live in the house you claim residency in? I’m not a tax attorney so I don’t know.

19

Yes, you have to actually live in the house you claim residency in. I believe it’s two years to get out of the capital gains tax- or something of that nature.

20

Screw the satisfaction of revenge and extortion. Keep everything happy, then:

  1. move out.
  2. report him.
  3. profit!