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Real Estate Investors, Stock Traders, and Business Owners guide to preserve their wealth, protect their assets, and prosper in the future.
Episodes
Tuesday May 16, 2023
Tuesday May 16, 2023
Welcome to another episode of the Tax Tuesday show. Host Eliot Thomas, Esq., Manager of Tax Advisors at Anderson Business Advisors, welcomes Kurt Bergfjord, CPA for Entrepreneurial Business Services at Mazars, to help answer your questions. We send a big thank you to all our people online answering your questions today including Dutch, Sergei, Jared, Kurt, and many others.
On today’s episode, experienced tax advisor Kurt Bergford and Eliot discuss the three capital gain tax brackets, tax tips for real estate investors, S-Corps and LLCs, and financial planning strategies for families.
If you have a tax-related question for us, submit it to taxtuesday@andersonadvisors.
Highlights/Topics:
- Is it true that you don't pay capital gains or dividend taxes if you make less than $40,000? If your total combined income is under 40K, there are no such taxes.
- I've been contributing to an HSA for several years. Can I withdraw funds from an HSA for prior medical expenses without a penalty? If so, how far can I go back? - as long as you have receipts, hold on to them and get the reimbursement in later years.
- Filing out state taxes. What are the pitfalls? Do we have to submit a whole state return if you have an investment in that state? - Your ‘resident state’ will tax your income from other states. You may have to file a non-resident income tax return in other states.
- Our LLCs, taxes of Partnership sold five long-term rental properties and it acquired one new rental property in a 1031, light, kind exchange. The original LLC still owns additional properties. How soon can we move the newly acquired property into a new LLC to be taxed as an S corporation? - Its not so much about the time frame but moving from one taxpayer to another ..it may disqualify your 1031
- We decided to be treated as an S corp. I've heard that we need to determine our W-2 salary based on our level of engagement each of the members have in the business. How can we determine our percentages? - To determine the percentage of ownership in an S Corporation, consider factors such as comparable technical knowledge, experience, and the average wage for the role.
- I'm thinking of transferring my primary residency into an LLC that I own and turning it into a rental. Can you explain how I should make the transfer so that I can get the 121 exclusion and have higher basis for the property in the LLC? - The 121 exclusion can be utilized by selling the primary residence to an LLC taxed as an S-corp, allowing for rental property depreciation.
- Can you speak about how options are taxed… would I pay capital gains on the spread or the total I received? Is it a capital loss? Is the cost basis lowered? Brokerage displays a lower cost-basis…This is difficult and complex…the credit spread occurs when you sell at one strike price, and buy another at different strike price…
- Do you recommend putting a flip into an LLC, If we buy and hold, later decide to sell, how does one change the LLCs, and how important to have the same address on the LLC… Living Trusts- should every property be included? Would you add homes if you’re only going to have them for 6 months. – Yes, if you’re flipping, don’t put it in your name. We want liability to stay in the LLC. You can use the same name but we don’t recommend it.
- Filing my 2022 as an S-Corp, my CPA recommended a profit-sharing plan, can I put it into a SEP-IRA, which do you recommend? - You need earned income from the business.
- I heard I can pay my kids without tax implications, what can I pay them? - Great strategy, put them to work, it's a tax deduction to your business. They need to do actual work. In 2023 it should be lower than their standard deduction of $13,800.
- Rapid-fire chat questions answered at the end of the show
Resources:
https://www.linkedin.com/in/kurt-bergfjord-cpa-08873053/
taxtuesday@andersonadvisors.com
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/
https://andersonadvisors.com/
http://aba.link/youtube
Anderson Business Advisors LinkedIn
https://www.linkedin.com/company/anderson-advisors/?originalSubdomain=fr
Thursday May 04, 2023
Thursday May 04, 2023
In this episode, Toby Mathis, Esq., of Anderson Business Advisors welcomes Karim Hanafy, Esq., head of Anderson Business Advisors’ Non-Profit Division. Karim and Toby will go over nine benefits of establishing a family foundation, the various tax benefits, and show you how you can get started today.
Karim Hanafy is a nonprofit attorney with over 20 years of experience forming nonprofit organizations, obtaining 501(c)(3) tax-exempt status, advising with ongoing compliance, and assisting with annual tax reporting. Karim previously worked in the Tax Exempt Division at the IRS, and he uses his IRS experience to advise nonprofit organizations on the application process and ongoing compliance.
Highlights/Topics:
- Karim’s background, the IRS, and journey to Anderson
- Legacy planning and asset protection
- Non-profits are not just for the wealthy
- The list of benefits
- Annual donation limits - public vs private, cash vs. stock
- Growing assets ‘tax efficiently’
- Family can serve as board members
- Control is maintained by the family
- Payout requirements - private vs public
- Working for a foundation after retirement
- Deferring your salary from a non-profit
- Avoiding estate taxes
- Next steps to starting a non-profit
- Public charity or private foundation?
- File with the IRS - Karim has been getting approved with lightning speed- 100% of Anderson’s filings are approved
- Funding the non-profit
- Contact Anderson Business Advisors or come to our Non-Profit Workshops
Resources:
https://www.linkedin.com/in/karim-hanafy-3561b71b0/
Start Your Non-Profit in 45 Minutes with Anderson Business Advisors
https://andersonadvisors.com/nonprofit-501c3/
Sign Up for Anderson’s Non-Profit Workshop
https://andersonadvisors.com/how-to-start-a-nonprofit-workshop/
https://www.youtube.com/c/tobymathisesq
https://andersonadvisors.com/
Tuesday May 02, 2023
Tuesday May 02, 2023
Welcome to another episode of the Tax Tuesday show. Host Toby Mathis, Esq., joins our regular guest Eliot Thomas, Esq., Manager of Tax Advisors at Anderson Business Advisors, to help answer your questions.
On today’s episode, Eliot and Toby answer listener inquiries, including a mother and son who want to set up an e-business together, a question about filing an extension for your taxes, which is almost always a good idea, and a question about writing off a pool that is required for a medical condition, (which is a surprisingly common question!)
If you have a tax-related question for us, submit it to taxtuesday@andersonadvisors.
Highlights/Topics:
- I had to put more money into my LP for stock options trading- what is the easiest way to handle this addition to my LP? - You can put cash in, or capital contribution - there are no tax implications putting money in, or taking money out.
- Is it a good practice to file an extension? Yes it is - if you rush, you may have to do an amendment…it gives you time to breathe. I don’t know any instance when it is a bad idea.
- If I plan to leave investment property to my children, is it better to purchase and leave it to them in trust, or put their names on title? - They may have stepped up basis issues later on. I don’t recommend gifting things when you are still alive. If the kid is on the title, the child could have liability issues, and you lose the step up in basis.
- No activity in LLC for 2022- Do I need to file tax forms? - if its a partnership and absolutely no transactions, file a ‘no activity’ return. S-corps and C-Corps must file.
- What is bonus depreciation on residential property? Is there a disadvantage for carrying forward a large loss? - Bonus depreciation is just the ‘speeding up’ of straight-line depreciation. No real issues with carrying the loss forward…but it depends on your income.
- What is the best tax structure to set up eBusiness, for a co-owner son and mom - S or C Corp have better tax options than a partnership? Is mom materially participating?
- Pool installation for minor son, is it possible to do a tax deduction? - if it is for medical reasons, it is a possibility. You must document that this is the only option.
- 1099 income, how much to contribute to solo IRA/401K? Employee and employer contributions? – There is a calculation, and a maximum of 66K in 2023, yes, you can- but I wouldn't. Talk to your tax professional
- Federal tax rate for capturing depreciation on property from a previous 1031? - if its 1250 real estate, or 1245, in order to figure this out you have to do a cost seg.
- My AGI is 300K, I gifted to charity 90K – and thought I could also gift 90K in non-cash. Tax preparer said non-cash giving. - There is a 60% limit for cash donations. Non-cash has different limitations, depending on the non-profit.
- My only source of income is from 4X trading, 5K trades a year, 10 hours a day, what are the benefits in creating an entity to pay less taxes? I’m borrowing 15-30K, usually paying interest of 2K a month. - You want to have a note, and records of the interest. A C-corp would allow for some deductions and reimbursements, and be able to write off expenses.
Resources:
taxtuesday@andersonadvisors.com
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/
https://andersonadvisors.com/
http://aba.link/youtube
https://www.youtube.com/@TobyMathis
https://www.tiktok.com/@tobymathisesq
Thursday Apr 27, 2023
Thursday Apr 27, 2023
Is it possible for government restrictions to kill your business?
In this episode, Toby Mathis, Esq, of Anderson Business Advisors welcomes entrepreneur Lars Jacobson, who purchased an entire town called Jake’s Landing right on the Canadian border. Lars shares his story of how border shutdowns, Covid restrictions, and lack of promised support from the US government have nearly killed the town’s business (and are still being enforced!). Canadians were accustomed to driving just minutes over the US border for cheaper gas, convenient shopping, and for dining and entertainment at the area’s casino. Tune in to hear this real-life story of government restrictions almost wiping out an entire town’s economy. Donate to help this town recover by clicking the Venmo link in the resources section.
Highlights/Topics:
- Buying a town- it was a calling from God
- Jake’s Landing and its businesses
- Charging less for goods and services in town - serving Canadians
- Border closing for Covid - it hit the town hard
- Unable to get SBA supplemental support
- Ridiculous Covid restrictions that have not been lifted at the border
- Business has only recovered 30% of the previous levels
- News coverage and meetings with local politicians have not helped
- The US is still handcuffing our own citizens with outmoded Covid restrictions that are killing small businesses
Resources:
Help Support Jake’s Landing USA with Venmo
https://account.venmo.com/u/JakesLandingUSA
https://jakeslandingusa.com/
https://www.facebook.com/jakeslandingporthill/
https://www.youtube.com/c/tobymathisesq
https://andersonadvisors.com/
Tuesday Apr 25, 2023
Tuesday Apr 25, 2023
Want to invest in real estate, but don’t know how to pick the best city to invest in? Mid-term rentals might be your option. Join Clint Coons, Esq. and Dr. Rachel Gainsbrugh as they discuss the secrets of maximizing mid-term rentals that can generate up to $60,000 a year. Dr. Rachel Gainsbrugh of Short Term Gems to help us explore the benefits of this strategy and its potential for a wide range of investors in the real estate market.
Highlights/Topics:
- Gainsborough’s background
- Why start with short-term rentals?
- The luxury niche and mid-term rentals
- What standard “luxury” means in rentals today
- Competing with REITs
- Your avatar/customer dictates what properties you should invest in
- Serving large families for both vacations/displaced
- Allowing pets increased revenue by 30%
- Most displaced families want to stay near their work/school
- Where to list mid-term rentals
- How does the revenue/ROI/amount of effort compare – short vs. mid vs. long
- How to access training in Dr. Rachel’s methods
Resources:
Learn More About Dr. Rachel Gainsbrugh!
https://www.linkedin.com/in/dr-rachel-gainsbrugh
https://www.shorttermgems.com/
https://www.shorttermgems.com/75gems
https://www.shorttermgems.com/join
https://www.shorttermgems.com/75gems
https://www.shorttermgems.com/media
https://www.shorttermgems.com/join-our-facebook-group
https://www.furnishedfinder.com/?gclid=CjwKCAjw0ZiiBhBKEiwA4PT9zw4A88skpF6sv-wj39emMCtr5pAq_uIz3_7K8AetwnbT8BLr4Xe0gxoCI84QAvD_BwE
https://www.corporatehousingbyowner.com/
https://www.alesolutions.com/
https://andersonadvisors.com/
https://andersonadvisors.com/podcast/
https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w
Thursday Apr 20, 2023
Thursday Apr 20, 2023
Is it possible for real estate investors to increase their profits with a fractional CFO? The answer is yes. Fractional CFOs can significantly reduce risk and increase profit margins for real estate investors in a number of ways. What is a fractional CFO? The CFO is the Chief Financial Officer and fractional means part-time. A Fractional CFO is a way to utilize the CFO’s skills at a fraction of the full CFO price tag.
In this episode, Toby Mathis, Esq, of Anderson Business Advisors welcomes David Richter, Founder and Owner of SimpleCFO. David empowers business owners to make more profit and live life on their terms with the SimpleCFO Fractional CFO program. He is also the author of “Profit First for Real Estate Investing.” Toby and David discuss the benefits of incorporating a CFO into your real estate investing business. David has an interesting range of solutions that will help investors increase their business revenue, owner’s pay, cash reserves, and more!
Highlights/Topics:
- David’s background as an investor, and starting a fractional CFO
- What a Chief Financial Officer (CFO) does
- 3 reasons investors need these services
- The “hope and pray plan” and comparison system
- Making money is easy - what to do next is the hard part
- Profit first, allocating bank accounts for taxes, etc.
- Sales - Profit = Expenses with the Profit First system
- Getting clarity around how much you actually need to keep
- SimpleCFO’s structure and meeting schedule with clients
- At what point should you get in touch with SimpleCFO? Click the link below
Resources
Download the FULL Ebook of Profit First For Real Estate Investing
https://simplecfo.com/anderson/
https://andersonadvisors.com/
Tuesday Apr 18, 2023
Tuesday Apr 18, 2023
Welcome to another episode of the Tax Tuesday show. Host Toby Mathis, Esq., joins our regular guest Eliot Thomas, Esq., Manager of Tax Advisors at Anderson Business Advisors, to help answer your questions. Even though it’s tax season, we have nine Anderson staffers on board to answer your questions
On today’s episode, Eliot and Toby answer listener questions including inquiries about purchasing a bar/restaurant and all the aspects you need to take into consideration around this difficult industry, a few questions (as usual) around rental properties and when/if you can take deductions and write off losses, and an interesting code question about oil and gas and intangible drilling costs (IDC).
If you have a tax-related question for us, submit it to taxtuesday@andersonadvisors.
Highlights/Topics:
- If you have a corporation with your children as board members, can you write off vehicle, maintenance, and gas? - If they are not employees, they are eligible for “reimbursements” not written off as business expense.
- Spouse and I are filing joint 2022 return, she had a $6000 W2, can I make a $3000 contribution, or must it be made to her IRA because it’s her W2? - If you made less than the $13K deduction, no taxes are owed. If you contribute to a Roth, no taxes….
- Can you discuss Tax benefits of retirement funds to fund/start/loan my business? - buy shares of a C Corp with your retirement fund.
- Tax effects of intangible costs for oil and gas? - IDCs can give you a 100% deduction in certain cases
- Paid kids $12K for my rental business, should I issue a 1099? If its disregarded or a partnership, kids under 17 can be issued a W2, if under age 18 no taxes due.
- Bought a house in 2022 with plans to rent, still working on repairs, do I get tax benefits for this project? - No, it has to be placed into service to be eligible for losses/expenses…
- How do I do cost seg if I purchased and rented out in 2022? Accelerated depreciation? - Cost seg is all about depreciation, yes you can do it to take advantage. Once cost seg is done, extend until Oct 15.
- I purchased Airbnb 2022, and put into use same day, purchased furniture/renovated, my accountant says I have a loss and am unable to do bonus depreciation? – There are other factors, but did you materially participate? If so, yes that is ordinary loss.
- When should I file as S-Corp instead of disregarded entity? not single entity…. - Don’t put real estate rentals in a corporation, when you take it out it’s taxable…
- Is there an AGI limit for claiming passive losses on a return? - If you have rental activity, under $100K, you can write off $25K. Can they be carried forward? How to claim next year? - Yes, passive losses can be carried forward as “suspended”.
- I’m considering purchasing a bar/restaurant in FL, already established but not doing well, what should I consider before doing this purchase? - Are you buying the assets, or the entity that owns the bar - if the entity, you may inherit any legal issues and no depreciation. If you buy assets, you can depreciate assets at the price you paid.
Resources:
taxtuesday@andersonadvisors.com
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/
https://andersonadvisors.com/
http://aba.link/youtube
https://www.youtube.com/@TobyMathis
https://www.tiktok.com/@tobymathisesq
Thursday Apr 13, 2023
Thursday Apr 13, 2023
Did you know that you can generate great rental income from unusual short-term rentals like tiny homes, yurts, teepees, and Airstreams?
In this episode, Clint Coons, Esq., of Anderson Business Advisors, welcomes Rob Abasolo, creator of the Robuilt YouTube channel, and professional short-term rental coach at Host Camp Coaching. Clint and Rob discuss the process of identifying great locations, building or placing rentals such as teepees and yurts, tiny homes and airstreams on your property (or rented property) near popular cities and tourist attractions to build wealth.
Highlights/Topics:
- How Rob left Kansas for LA
- Renting on Airbnb to cover the mortgage
- Building tiny houses and the challenges involved
- Getting started - rules and regs, financing
- Calculating your Airbnb potential revenue
- Get into the rental business with a house hack
- Tiny homes, small homes, regular homes
- Get coaching from Rob at HostCamp
- Yurts, glamping, teepees, and airstream rentals
- Checking your municipalities for rules and regs on unusual rentals
Resources:
https://ogw4vc0ko58.typeform.com/hostcamp#source=anderson
https://www.youtube.com/channel/UCdIM_XmhsVYbBhl3pgPq3dA
https://andersonadvisors.com/
https://andersonadvisors.com/podcast/
https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w
Thursday Apr 06, 2023
Thursday Apr 06, 2023
Have you thought about creating a TV commercial for your real estate business? TV commercials help you build an automated marketing channel, target the demographic you want, and they’re not as expensive as you might think!
In this episode, Clint Coons, Esq., of Anderson Business Advisors, welcomes Tony Javier, founder of the Real Estate Masters (REM) 10X TV Program. Clint and Tony discuss the value of advertising on TV where you can reach 10X more people, faster and cheaper with less effort than many other forms of marketing. Tony can help you appear in your own TV ad within 30 days, and he’s proven that people who see you on TV may not want to work with a realtor, and will begin knowing, liking, and trusting you to buy their home.
Highlights/Topics:
- Tony’s entre’ into TV and real estate started with late-night infomercials
- First TV spot earned 10X Tony’s investment
- Go to remtv.com and get on tv within 30 days
- Tony explains who can benefit from a TV spot
- The cost of advertising with TV and your target demographic
- Should you appear in your own TV commercial?
- How many people you can hit with each $5 of ad spend
- Reaching a lower-income audience with TV
- Advertising on TV is easily scalable
- Doing commercials is only for those who know what to do with leads
- Limiting ads in each market
- Check out remtv.com to start planning your TV spot
Resources:
Get Started with the 10X TV Program
Free Asset Protection Workshops
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/
Tuesday Apr 04, 2023
Tuesday Apr 04, 2023
Welcome to another episode of the Tax Tuesday show. Host Toby Mathis, Esq., joins our regular guest Eliot Thomas, Esq., Manager of Tax Advisors at Anderson Business Advisors, to help answer your questions. We send a big thank you to all our people online answering your questions today - Patty, Dana, Dutch, Jared, Kurt, Ross, Tanya, and Troy.
On today’s episode, Eliot and Toby answer listener questions including inquiries about wash sales, what taxes apply to inherited stocks and real estate and the appreciation on inherited real estate, buying vehicles and how much is deductible and when, and setting up a brokerage account for a charity so it can receive donations of stock.
If you have a tax-related question for us, submit it to taxtuesday@andersonadvisors.
Highlights/Topics:
- If I have a company and want to loan money to another company using a promissory note, but I don’t want to charge them interest to do so, are there any tax impacts to my company? What is the recommended way to do this if so? – if it’s over $10,000 we got to charge interest to what it boils down to.
- Do you need to pay both capital gain tax and estate tax for inherited stocks? – Well, typically, if you inherit something, you're not going to pay any tax because of the approximately $12 million lifetime exclusion. If the gift or inheritance was over $12 million, in this case, you're going to receive stocks at stepped-up basis.
- Does real estate appreciation restart for 30 years after inheritance? Will real estate appreciation be re-depreciated? – I think what they’re trying to get to here is will you be able to depreciate again at 27 and a half years if it’s a long-term rental and yes, you will.
- I have an IRA owned single-member LLC that has invested in three syndications. Two of the three have losses over the last several years, which means it’s just kicking down passive losses, it doesn’t mean you lost money. One was sold last year and has profit, which is fairly common. Do you use a 990T to report both losses and profits? I don’t have to report profits or losses on my 1040, correct? - You don’t have to report it on your 1040 because it’s all in your retirement plan.
- Does the holding period for real estate start on the acquired date or the place in-service date? If bought in November 2020 and placed in service, placed in service March 2021, sold December 2021, is this long-term or short-term capital gains? - It’s going to be long-term. We’re going to go from the date where you closed, that’s where the holding period starts.
- When will we recoup the loss from a wash-sale if we’re no longer investing? - We wouldn’t run into a wash-sale in this instance because you sold the stock, you take your loss, it’s only if you buy back stock or a similar security that you would run in a foul of the wash rule within 30 days of it.
- When bonus depreciation goes away, what will be the process for cost segregation? How is it calculated and how much will be allowed to be deducted at what time or intervals? - we still can do cost segregation which is just an alternative, We’re still going to deduct it. It’s just how much is going to go into that 5-year property pile, the 7, the 10, 27.5.
- I have a 501(c)(3) that I started with Anderson—Kareem and his team are killing it by the way. It is ridiculous. The average wait time to get a nonprofit exemption certificate approved by the IRS is right around seven to nine months. We’ve been getting them, in some cases, in a matter of days. I was wondering if you were to donate appreciated stock to the charity, how to donate that to the charity properly and how do you record it as a personal donation, with appreciation? Does the charity need to start a brokerage account to receive this stock? – We certainly want to set up a brokerage account in the charity because when it receives that stock, they’ll have a place to put it.
- Should I set up a C-Corp LLC for land flipping business even if I just started, no deals yet? Should I start with the pass-through first then change to a C-Corp once I get more volume? – I would set that C-Corp so you can start building up losses and expenses in that C-Corp. When you flip it and you have that gain come in, you're automatically offsetting against that gain.
- When you buy a bigger van for the business, do you depreciate it or show it as an expense on the year you buy? Where do I find a list of business expenses that are 100% deductible and other expenses are not? – Well first of all for the van itself, how you're going to depreciate depends of course on the size if it’s over 6,000 pounds, etcetera. You probably got bonus depreciation a lot more of it. It may not be 100% anymore, but we probably solved the 80% going on.
- Is there a maximum number of LLCs that I can use for the IRC-280A deduction? I have two LLCs and I was wondering if I can take the deduction for both? Also, I have a nonprofit and was wondering if I could also have meetings for a nonprofit and the fee for using the space would be a donation from my LLC? - Well, 280A is a provision, it actually comes under a section that is dedicated to not letting you deduct personal expenses in your house particularly. – if you donate $10,000 to your nonprofit, is that the nonprofit can use it for nonprofit purposes.
- How do adjusted gross income AGI levels affect capital gains? Is it true that AGI below $76,000 will pay no capital gains? - Actually, AGI doesn’t have anything to do with this. It’s taxable income when we talk about the brackets for capital gains. The $76,000 is an old number. It’s approximately $83,000 I think this year.
- I’m opening a new IRA that will be managed by an IRA with custody TD Ameritrade, it will be funding a new IRA from existing IRAs, so it sounds like a rollover from the same custodian. I have a Wyoming LLC Anderson just set up. Should I open the new IRA in the name of the LLC and will it be a problem moving funds from a personal IRA that is titled with my name? - You can roll one over into the other, but what caught my attention was this Wyoming LLC- you can't just have that connected to a retirement plan. Your IRA needs to set up its own LLC that it owns, and then it can transfer funds into that LLC and go do investing in real estate or what have you. But you do not want to take some other outside LLC that we set up for you and connect that with your IRA, we’re not allowed to do that.
- Rapid-fire chat questions answered at the end of the show
Resources:
taxtuesday@andersonadvisors.com
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/
https://andersonadvisors.com/
http://aba.link/youtube
https://www.youtube.com/@TobyMathis
https://www.tiktok.com/@tobymathisesq