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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
Thursday Feb 09, 2023
Thursday Feb 09, 2023
Today we’ve got another interesting episode of Anderson Business Advisors. Host Toby Mathis, Esq., speaks with special guest Rabbi Natan Alexander from Israel. In recent years, Rabbi Natan has taken all his collective experience and education to work with Leader of the Pack, which he founded in 2018. Leader of the Pack is a Brotherhood, a movement, created by Rabbi Natan Alexander to re-empower men to become the great individuals that God designed them to be. The group is a tribe of men constantly working on themselves and holding each other accountable to Stand Up, Lead and Protect.
You’ll hear how the men in the program learn a wide range of skills such as Krav Maga and other self-defense tactics, weapons training and practice, heightening your awareness of potential threats in your surroundings, and other methods that enable men to be aware of, and trust, their instinct, and learn to be violent [when it is called for], to keep themselves and their families safe.
Highlights/Topics:
- The resistance to training men to be better men
- Rabbi Natan’s story
- Men and their roles - changing through the decades
- Religion is not the main focus of LOTP
- The type of skills and training provided
- Women also want to learn these skills
- A story about maintaining honor in the global LOTP weekly calls
- Keeping yourself and your family safe means forgetting about legal or religious rules – it should be pure instinct
- An exercise in being aware of potential threats and questioning aberrations
- Listening to your instincts
- Live event costs are all-inclusive and very affordable
Resources:
ravnatana@gmail.com
Register for Live Events with Leader of the Pack
https://leaderofthepack.co.il/event-specials/
https://leaderofthepack.co.il/
https://andersonadvisors.com/
https://www.youtube.com/@TobyMathis
https://www.tiktok.com/@tobymathisesq
Tuesday Feb 07, 2023
Tuesday Feb 07, 2023
Welcome to another Tax Tuesday show. Toby Mathis, Esq., hosts, with special guest Eliot Thomas from Anderson Advisors, and they are here to help answer your questions. On today’s episode, Eliot and Toby dig into some listener questions surrounding the differences between an LLC and S-Corp and the pros and cons of each, avoiding capital gains taxes, and the usual assortment of questions about short-term rental properties (ie AirBnB), cost segregation, and qualifications to claim Real Estate Professional status.
If you have a tax-related question for us, submit it to taxtuesday@andersonadvisors.
Highlights/Topics:
- "If I choose cost segregation, do I have to apply the cost seg to all properties purchased in the same year, previous years, and future years? What are the disadvantages—tax aspects and non-tax aspects—of doing a cost segregation?" – If you do a cost seg, you're not required to use it on your other properties. That's very specific to one property.
- "I bought an apartment to fix it and put it up in Airbnb and to get the advantage of new business tax deductions. But now that we are thinking of renting it to regular tenants, this will be an investment instead of a business, correct? What are some of the deductions that we can take advantage of if we rent it to regular tenants instead of Airbnb such as renovations, expenses, travel expenses, furniture, and so on and so forth?" – Turning it into a long-term rental, you pretty much get some of the same deductions you would as a long-term versus short-term. They're the same.
- "Is it beneficial to set up an LLC versus an S-corp? And are you able to pay yourself a reasonable salary through an LLC?"- There are rules behind that. If you don't choose a tax status forth, the IRS will choose for you the basics… like Eliot said, it depends on how the LLC is taxed.
- "How should I hold my stock positions? What is the best way to deal with high capital gains consequences?" - We often talk about setting up a trading partnership, that might be one option.
- "My husband will work as a real estate agent to qualify for the IRS’ definition of real estate professional, and potentially use the passive losses from our rental property to offset my W-2 income on our joint return. The IRS rule says my husband has to own at least 5% interest in the real estate company employing him. Does he need to form an S-corp to sign the contract with the brokerage firm so that he owns at least 5% interest?" - Yes, that's exactly right. You're going to want to have his earnings, if you will, from there being paid through an S-corporation that he owns, theoretically 100%, hopefully.
- "I sold an investment property on October 21 and paid a very heavy capital gains tax. Can I get some of that back if I buy another investment property today or now?" - No. We missed the boat on that. We can't carry back on any of these items at this point in the code. Maybe that'll change in the future, but right now, we don't have the ability to go back and change anything.
- "How many years can we go back without showing a profit?" - If you have too much of a loss, the IRS could come in and say, hey, is this really a for-profit business venture that you have going on here?
- "Is it okay to do your own taxes as a business owner if you had a CPA for 20 years?” Why is it a questionable call there? - We just had a massive overhaul of our tax code. You're going to want a CPA, somebody who does taxes, EA, tax attorney, whoever it is, to walk you through some of those things.
- "I bought a single family rental in November and am still repairing. No income yet. How do I record depreciation and costs for 2022?" - If we didn't have it available for rent in 2022, there isn't any deduction to take in those as far as operational, depreciation, or anything like that.
- "How to save taxes by flipping and renting houses?" - We're going to recommend a C -Corp probably as a management company so you can do all your activities that you're overseeing of your rentals through a C-corporation.
- "I just started my business in August of 2022. I would like to understand what from a tax perspective should be on the top of my mind as we prepare the first returns." - It depends on your business, but you're going to want to categorize and have an idea of what expenses are, to determine whether it's a net profit or net loss.
- Lastly, "If an investor purchases a property that is lower in value than the property sold in a 1031 exchange, will the IRS disqualify the exchange entirely?" – No. What's going to happen is you just may not have full deferment of the capital gains, but they're not going to disqualify it on that premise. Work with a qualified intermediary!
- Email us with your questions, and be sure to subscribe to our podcast. And if you are already a subscriber, please provide us a review of what you thought!
Resources:
taxtuesday@andersonadvisors.com
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/
Monday Feb 06, 2023
Monday Feb 06, 2023
In this episode, Toby Mathis, Esq. and Clint Coons, Esq., attorneys at Anderson Business Advisors discuss all things real estate investing in Q1 2023. The fear that is prevalent around the housing market indicates that now is a great time for investors to grab some great deals.
The guys then go on to a discussion about luxury builders whose properties are simply unaffordable right now, and in fact, affordability is at one of the worst levels in history. The lack of supply vs. demand is also a huge factor, potential homeowners are becoming renters instead, there are lots of tech layoffs, and the ripple effect from all these factors is still going to be playing out over the course of 2023– creating opportunities for investors if you know where to look.
Highlights/Topics:
- The attitudes around the market today
- Cash flow is king for investors
- Strategies for eight months to a year from now
- Inventory is at half the normal levels
- The Harvard report - increasing needs for housing
- Building for renters vs selling on comps
- Affordability is at the worst point in history
- Buying land for manufactured housing is interesting
- Bread and butter homes are becoming unaffordable
- WSJ article - cutting big salary employees, remote work issues
- Anderson's sister company Infinity Investing
Resources:
https://infinityinvesting.com/
Infinity Investing Free One-Day Workshops
https://infinityinvesting.com/infinity-investing-workshops/
Free Asset Protection Workshops
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/
https://andersonadvisors.com/
https://www.youtube.com/@TobyMathis
https://www.tiktok.com/@tobymathisesq
https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w
Thursday Feb 02, 2023
Thursday Feb 02, 2023
In this episode, Clint Coons of Anderson Business Advisors welcomes Kevin Kiene of ezlandlordforms.com. Kevin has appeared on many different podcasts and is a familiar name in the real estate rental space.
You’ll hear about Kevin’s start as a landlord at the tender age of 18, how he kept finding things he needed to add to his lease agreements (the genesis of EZLandlordforms), tips and tricks regarding what to look for when screening applicants, different clauses and protections available through EZLandlordforms, and what to do if things take a turn and you need to send notices or evict tenants.
Highlights/Topics:
- Background – how Kevin got into real estate
- What to look out for in the application screening process
- Mistakes to avoid and things to include when creating a lease agreement
- Help with the processes - notices, eviction, lease enforcement, etc.
- The state of real estate rentals today
Resources:
https://www.ezlandlordforms.com/?ref=andersonbusinessadvisorsandersonbusinessadvisors
https://www.facebook.com/ezLandlordForms
https://www.youtube.com/user/ezlandlordforms
https://www.instagram.com/ezlandlord/?hl=en
https://www.tiktok.com/@ezlandlordforms
Free Asset Protection Workshops
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/
Tuesday Jan 31, 2023
Tuesday Jan 31, 2023
In this episode, Toby Mathis and Clint Coons of Anderson Business Advisors discuss the new Corporate Transparency Act, and what it means for investors. The CTA is meant to prevent fraud within business entities by requiring everyone involved to report all their personal information, but Clint and Toby agree it’s mainly another way for the government to try to grab a few more dollars.
The guys then go on to a discussion about separating, isolating, and hiding assets within different kinds of legal trusts to prevent losing everything in the case of a lawsuit. All of this extremely valuable information is also available for FREE at the monthly asset protection events. See the link in the resources section below.
Highlights/Topics:
- With the Corporate Transparency Act, all LLC’s will require reporting your personal information to the government
- No matter when you set up your entity, you will have to report
- Fraud will continue to happen, regardless of the laws
- Trusts often are not subject to taxes at the state level- and can provide anonymity
- Franchise fees - there are legal ways to avoid it with trusts
- Land trusts
- Asset protection from lawsuits - separate, isolate, and hide your assets to limit losses
- Entities - a better protection than insurance
- Unfortunate stories of unprotected asset losses
- Come to one of our free asset protection events!
Resources:
Free Asset Protection Workshops
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/
https://andersonadvisors.com/
https://www.youtube.com/channel/UCX5nh607M8hSBLiMB9MgbIQ
https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w
Thursday Jan 26, 2023
Thursday Jan 26, 2023
Today we’ve got another unusual and inspiring episode of Anderson Business Advisors, Toby Mathis speaks with Joey DeMaio of Valhalla Studios in New York. As you may know, Joey is the guitarist from the popular and long-lived metal band Manowar. Joey’s career has spanned over 40 years at this point, and as an artist and businessperson, he has a fascinating story to tell.
You’ll hear how Joey joined a band days after seeing The Beatles on Ed Sullivan, some insider tips and advice about the “business” of music, how Manowar has survived and thrived for four decades and continues to perform around the world to huge crowds, and Joey’s many successes in and around the music business - running a studio, scoring movies, touring, and much more.
To most, DeMaio is known as the internationally acclaimed and award-winning virtuoso bass guitarist, founding member, composer, lyricist, engineer, and producer for the world-renowned Rock/Heavy Metal band MANOWAR, who have sold over 30 million records to date, and continue stunning their audiences with sold-out festival and solo performances ranging from 10,000 to 80,000 people a night. Since their inception, DeMaio has successfully steered the career of MANOWAR, who today are more popular than ever, all over the world.
Highlights/Topics:
- Joey's history with Manowar and myriad of amazing accomplishments in business and music
- Seeing The Beatles on Ed Sullivan - Joey’s future was clear
- Surprising insider nuggets about the music industry- musicians MUST know the business, and the band feeds an enormous network of people
- Manowar and their more than 40-year career– still going strong
- Breaking into the music business today- are you a ‘musician’, or a ‘performer’?
- Monetary scenarios - earning a living in the music business
- Manowar - what’s new, what’s next?
Resources:
https://linktr.ee/realjoeydemaio
https://manowar.com/
http://valhallastudiosny.com/
Magic Circle Entertainment LinkedIn
https://www.linkedin.com/company/magic-circle-entertainment/about/
https://andersonadvisors.com/
Tuesday Jan 24, 2023
Tuesday Jan 24, 2023
Tax Tuesday is here again. Toby Mathis hosts, with special guest Eliot Thomas from Anderson Advisors, here to help answer your questions.
On today’s episode, Eliot has grabbed a bunch of great questions for us to answer. Toby and Eliot will talk about the Augusta rule, easy tax deductions against W-2 income, cost segregation, bonus depreciation, real estate professional status, active participation, S-Corp, C-Corp and partnership advantages. Online, we have Ander, Patti, Ian, Dana, Matthew, Jared, Piao, Tanya, Troy, and Dutch, a multitude of CPAs, by the way, in our Q&A. If you ask questions in Q&A, you're going to get really, really smart people answering that question. Toby sends out a a huge public thank you to all these talented people.
If you have a tax-related question for us, submit it to taxtuesday@andersonadvisors.
Highlights/Topics:
- "I'm selling a property that was willed to be in 2019. I've been renting this property out since receiving it. It will sell for a profit of over $360,000. Would I pay taxes on the full profit or the difference between value at the time the property was willed or do I pay taxes on the difference between the profit and $250,000?” - You inherited it in 2019. It says you've immediately started renting it out, so it's an investment property. It's not going to qualify for the capital gain exclusion of living in our primary residence for two of the last five years.
- "What are some simple easy things that can be done to reduce taxable income and reduce taxes paid on each of my paychecks?” Donate to charity in large chunks, HSA, IRAs, etc.
- "Options for tax write-off, reducing tax burden if I have rental real estate, but I am not a full-time real estate professional. Both my wife and I have W-2 jobs that we don't foresee leaving anytime soon to become real estate investors." - See the answer to previous question, and also you want to look at if your AGI (adjusted gross income) is a little bit lower, maybe under $100,000, you can take up to $25,000 of the passive losses.
- "Augusta Rule: We have put our properties in a Wyoming entity and the Texas series LLC in late December of 2022, but have not started using it yet. Can we use the Augusta Rule in 2022 throughout the year for our business purposes, even though we've not completed setting up the business?" Augusta Rule, that's just what we call 280A most often. That's the ability to rent out your home. Dwelling is the proper term for no more than 14 days a calendar year. The income you receive, you don't have to pay tax on.
- “When a rehab required property acquired for long-term hold, when is the right time to do the cost segregation study? Before the rehab or after?" - Once you purchase a property or after the rehab, you could do it either way. If you don't do what's called a cost seg study, the IRS will let you treat it all as 27½ years…
- "Anderson created my S-corp entity in November of 2022. I've only had expenses for the year-end 2022, but no income or property purchases yet. What am I required to file for my S-corp regarding the expenses I've incurred?" – You're going to have to file your tax return for that S-corp. It is what we call an informational return. In other words, your S-corp doesn't pay any tax, but it does have a tax return called an 1120-S.
- "I created my two LLCs both with real estate assets with rental income in 2022. Also, I created a holding company that holds both the LLCs. I have a W-2 job. When do I file the tax for the holding company? Is it one tax filing that combines all the LLCs and my W-2?” - We recommend that the holding company becomes a partnership. Also, it helps from a lending standpoint. Typically, lenders are able to lend more to you being that the property is in a partnership than if it had been in a direct disregarded LLC.
- "Curious to hear an open discussion about one and how to utilize section 179 and/or bonus depreciation for vehicles." - Why not just do mileage reimbursement? It's like 65.5¢ a mile right now. It's your car. You can use non-commercial insurance. It could just be your car that you use. If you let employees use it, that goes out the window.
- "What are the steps to take in order to withdraw money from a C-corp account? Are there any tax consequences involved?" - With a C-corporation, the first thing I'd like to look at are the reimbursements…
- "How to save taxes as S-corp, and is it better to do an STD deduction?" - The S-corp has a lot of advantages to it to save on taxes. Standard deduction is huge for most people. But “it depends”.
- "Can you please touch upon what depreciation recapture is and how it impacts taxes?" - Basically, when you have an asset that's been used in a trade or business, we don't deduct the full cost of it immediately. We take a little bit over time, we call it depreciation. Then when you resell, you might have what's called depreciation recapture on that depreciation that you took over the years. It does depend on what kind of asset it is.
- "I work from my home office. How do I claim this?" - If you have a sole proprietorship, you can take a deduction for basically the percentage square use of that house, that’s an easy way to describe it. If you could get reimbursed, then it could be 20% of your house. By the way, that includes mortgage interest, property taxes. If you have somebody coming in cleaning your house, your utilities.
- Be sure to subscribe to our podcast. And if you are already a subscriber, please provide us a review of what you thought!
Resources:
taxtuesday@andersonadvisors.com
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/
https://andersonadvisors.com/
Thursday Jan 12, 2023
Thursday Jan 12, 2023
In this special episode of Anderson Business Advisors, Toby Mathis speaks with Jim Richardson and Diane Lawson of Front Porch Co-Housing about a growing issue in our country - the lack of independent, affordable housing opportunities for neurodivergent adults.
This is an opportunity for our listeners to help solve. There are 5.4 million autistic adults in the U.S. today, and 87% of these individuals live with their parents. It is crucial that there be a plan for those adult children when their parents are gone. Investing in real estate used for this purpose is an amazing opportunity to be “more than a landlord” and the non-profit status of the Front Porch Co-Housing organization can also offer the investor certain advantages.
Highlights/Topics:
- Diane’s experience with a neurodivergent son being denied housing
- Jim’s background - also has a son with autism who was denied housing
- The scope - millions of adults with neurodivergent issues
- A unique approach - co-housing neurotypical and neurodivergent adults - “neuro-inclusive living”
- Millennials (22-40), are experiencing unprecedented levels of loneliness and isolation
- The expansion plan for Front Porch Housing
- Costs for neuro-inclusive living - planning for an entire lifetime
- No state funding assistance – not classified as a ‘group home’
- Real estate investors can help their communities and be more than “just a landlord”
- Sponsoring a neurodivergent person in your community - visit the Front Porch link below
- Donations can also be land, real estate, vehicles to sell, and other assets - email Jim with the link below
Resources:
Front Porch Co-Housing Website
https://frontporchcohousing.org/
Donate to, or Support Front Porch
https://frontporchcohousing.org/support-us/sponsor/
diane@frontporchcohousing.org
jim@frontporchcohousing.org
https://andersonadvisors.com/
Toby Mathis on YouTube
https://www.youtube.com/channel/UCX5nh607M8hSBLiMB9MgbIQ
Tuesday Jan 10, 2023
Tuesday Jan 10, 2023
In this episode of Anderson Business Advisors, Toby Mathis speaks with Eliot Thomas, Managing Tax Advisor at Anderson Business Advisors. There are lots of people helping to answer questions online - Patti, Ander, Matthew, Troy, Jared, Piao, Ian, Dutch, and Dana are on. There are so many people here. You have a whole bunch of tax professionals that are here to answer your questions. You can just go into the Q&A and put in a question.
You’ll hear Toby and Eliot discuss several listener questions around how to report capital losses in the stock market, a few questions on real estate and business LLCs vs. S-Corps, C-Corps, and Sole Proprietorships, disregarded entities, entertainment meals vs. business meal write-offs, and an in-depth discussion about a real estate contractor not filling out a W-9 and all the difficulties that might present. Submit your tax question to taxtuesday@andersonadvisors.
Highlights/Topics:
- "Hey, I'm looking to start a new business. I need to choose a correct business entity in order to maximize my tax benefits, so I need to know if starting the business as an LLC and potentially working the business out of my home would be the best option for me." – by all means, you want the LLC for that asset protection, but the S-corp or the C-corporation—have those great reimbursements.
- "Can I write off my stock holding loss at the end of the year to reduce my W-2 earnings?" Yes, but we're limited potentially just to $3000 of capital loss that will offset against ordinary income, that being your W-2.
- "What are the rules for HSAs for people over 62?" – For 2023, the amount is going to be $3850 if you're single, and I guess it'd be $7750 for a family plan. If you are on Medicare, you can not contribute tax-free to an HSA.
- "I became a real estate professional in 2021 and have a significant net operating loss due to depreciation. What are the limitations of carrying the NOL backward in 2020 and 2019 to use that to lower taxes in the previous year?"-- As of right now, we don't get to carry back NOLs. We just carry them forward.
- "If my partnership LLC did not conduct any business this year, do I still need to file a Form 1065? -- You don't have to file 1065 for that first year.
- I'm in the process of setting up my real estate business. I already have a Wyoming LLC as a holding company. It's treated as a disregarded entity, but I have no investment in real estate yet. If I file my taxes this year before I acquire an investment property, what is the process for changing the filing election of the LLC from disregarded to a partnership for the new property?" – You don't have to do anything but file that return, or you could file the Form 8832 and declare it as a partnership.
- "I am new to real estate flipping and started my first flip last year. Construction was completed this year, and it closed this year. I asked my contractor if I need to complete a W-9 last year, and he told me not until the project was complete. Now, I'm realizing that I should have had him complete the form in 2021 for the amount I paid him and again this year. Can I now ask him to complete the W-9 and file the form for 2021 and 2022? The other issue is I had issues with this contractor for faulty workmanship he did on the flip and in the process of filing suit. What if he refuses to complete the W-9?" If you're dealing with a contractor who's organized as a business, chances are you still want that W-9 to prove that they're a business.
- "What forms do I need to fill out for my accountant to show capital loss in the stock market?" – Usually, you're going to get a 1099-B from your brokerage house. They can just use that, and that's really all you need.
- "As an owner-operator trucking company designated as an LLC, can you write off 100% of the operating fuel costs?" – If the truck that was burning that fuel was used 100% for business, absolutely.
- "I am a lender on a note to an LLC. What are the best practices for collecting payments and tracking interest payments for reporting purposes; separate bank account for the payments or create an end-of-the-year interest statement for myself?" - I like the separate bank account. Keep it separate from your personal obviously.
- "I attended your Las Vegas event. Please confirm if we are to refrain from listing items as entertainment when filing taxes." - They're probably referring to the Tax Cuts and Jobs Act getting rid of entertainment. There is no deduction for entertainment. If you are getting a meal that is for entertainment purposes, you cannot write it off. Business meals only for 2022.
- "I'm looking to convert from an LLC-S to a C-corp in 2023. Should I stay on a calendar or fiscal year schedule? What are the pros and cons?" – I like the fiscal year for C-corp because it tends to give you more flexibility, especially when it comes to payroll items or contributing to, say, Solo 401(k)s or something like that.
- Visit us at andersonadvisors.com. Grab one of the free events. We're going to do a ton of them this year.
Resources:
taxtuesday@andersonadvisors.com
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/
https://andersonadvisors.com/
https://www.youtube.com/channel/UCX5nh607M8hSBLiMB9MgbIQ
Tuesday Jan 03, 2023
Tuesday Jan 03, 2023
In this episode, Toby Mathis of Anderson Business Advisors welcomes Jose Luiz Morales, a self-made wealthy real estate professional who made many sacrifices at a young age in order to build a lifetime of wealth. Jose is a Real Estate Advisor with Morales Group, Brokered by eXp Realty, he has a podcast called “The Residual Real Estate Agent, and he belongs to a number of mastermind and mentoring groups based around investing and real estate.
You’ll hear the inspiring story of how Jose decided to stop hanging around with “knuckleheads” at age 23, and his life changed focus. By sacrificing a lot of the fun and frivolity most young people have in their 20s, Jose became a millionaire and built a foundation of assets that will not only allow him and his family to live a comfortable life, but they could feasibly even retire before age 40.
Highlights/Topics:
- Jose’s origin story
- Jose’s parents taught him the most valuable lessons, but never helped him financially
- At age 26 Jose’s monthly income was $6000
- Making sacrifices at a young age allowed for building wealth
- Moving out at age 27
- Everything Jose put on his vision/dream boards came to fruition
- Coaching, mentorship and mastermind groups
- Advice for young people - don’t hang around with knuckleheads
- Reach out to Jose to learn more about his methods and successes
Resources:
https://www.linkedin.com/in/joseluizmorales/
https://www.tiktok.com/@joseluizmorales805
https://www.youtube.com/@joseluizmorales
https://www.instagram.com/joseluizmoraies/
The Residual Real Estate Agent Podcast
https://podcasts.apple.com/us/podcast/the-residual-real-estate-agent-show/id1560901602
https://exprealty.com/
https://www.collective-genius.com/
https://andersonadvisors.com/
https://www.youtube.com/channel/UCaL-wApuVYi2Va5dWzyTYVw