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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
Monday Jul 08, 2024
Monday Jul 08, 2024
Have you ever worried about protecting your wealth during a volatile election year? Wondering what the rest of 2024 holds for the market? In this episode, Toby Mathis, Esq. chats with Kevin Simpson, founder and chief investment officer of Capital Wealth Planning, LLC. Kevin is a $10.3 billion wealth management expert, and shares insights from his book "Walk Toward Wealth" on navigating market uncertainty. Learn how to manage risk, write covered calls to hedge against volatility, and discover the surprising truth about election year performance. Kevin will also delve into the Madoff scandal, helping you identify a trustworthy custodian for your hard-earned money. Don't miss this opportunity to gain valuable advice and protect your financial future!
Highlights/Topics:
- Market volatility in an election year
- Predictions for the market through the end of 2024
- What’s driving the earnings?
- Statistics around the economy
- Capital Wealth manages $10.3 Billion
- Managing risk
- Writing covered calls, managing volatility
- How presidential elections affect the market
- Stories from Kevin’s book “Walk Toward Wealth”
- What duty should you be looking for?
- The Madoff scheme, finding a reputable custodian
- Advice for Kevin’s younger self
- Send us your questions and ideas for future show topics!
Resources:
Schedule Your FREE Consultation
https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=investing-with-confidence
https://capitalwealthplanning.com/team/kevin-simpson/
https://www.kevinsimpson.com/walk-toward-wealth/
https://andersonadvisors.com/
Tax and Asset Protection Events
https://andersonadvisors.com/live-tax-and-asset-protection-workshops/
https://www.youtube.com/c/tobymathisesq
Wednesday Jun 26, 2024
Wednesday Jun 26, 2024
Today, attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., delve into listener questions around topics like borrowing from your QRP (Qualified Retirement Plan) without it being considered income, utilizing depreciation from syndications as a real estate professional, and writing off Airbnb setup costs. Learn how to establish accountable expense reimbursement plans for your C-Corp, handle taxes for disregarded property holding entities, and calculate depreciation post-1031 exchange. Discover efficient strategies for paying kids in your small business and choosing between S-Corp and LLC structures. Simplify the complexities of C-Corp taxes and learn how to invest in real estate via self-directed IRAs without UBIT implications.
Submit your tax question to taxtuesday@andersonadvisors.com
Highlights/Topics:
- I am 65. If I borrow $30,000 from my QRP, would that be considered earned income?- No. You have to pay back with interest, but it is not income.
- As a real estate professional, can I also take the depreciation expense from syndications against my spouse's K-1 income? - Generally yes, if you are a REP, and it’s non-passive activity, if there was an overall loss, it can go on your return.
- Can expenses for building and outfitting an Airbnb spent this year be written off next year when the unit is rented? - yes, but it can only be written off after it has been “placed in service”
- How do I establish an accountable expense reimbursement plan for my C -Corp and a medical reimbursement plan? - Have a corp meeting, and adopt the plans with documentation of that meeting.
- If a disregarded property holding entity isn't taxed when our individual property expenses like taxes, insurance maintenance, and depreciation considered for income taxes? - Any income/expenses must be reported, flowing up into your 1040.
- How do I calculate depreciation after a 1031 exchange? - It’s your original property purchase price, plus any improvements, less depreciation. This again is on the original building you had, the one that we're going to relinquish.
- I want to include my kids as employees for my small business and I want to pay them in a lump sum annually. What would be the most efficient way to structure that? - If they are under 18 there’s no employment tax, if you are paying them through a partnership or a disregarded entity.
- Is it beneficial to be an S-corp or an LLC if making under a certain amount of money? - You want to be in some kind of entity, to protect yourself from lawsuits.
- What are the tax differences between an S and a C corporation? How hard are a C corporation's taxes to do? - Yeah, so the biggest tax differences between an S and a C then in a synopsis is the S corporation doesn't pay taxes, it passes it to its owners.
- How can I use my self-directed IRA to invest in real estate deals without being subject to UBIT? - don't buy any real estate with any debt or anything like that and make sure it's a long-term rental, and not a flip.
Resources:
Schedule Your Free Consultation
https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=the-main-tax-differences-between-an-s-corporation-and-c-corporation
Tax and Asset Protection Events
https://andersonadvisors.com/live-tax-and-asset-protection-workshops/
https://andersonadvisors.com/
https://www.youtube.com/@TobyMathis
https://www.tiktok.com/@tobymathisesq
Tuesday Jun 25, 2024
Tuesday Jun 25, 2024
Today Clint Coons explores the evolving landscape of the self-storage industry with guest Ryan Gibson, CIO of Spartan Investment Group. Topics include shifts in customer demographics, such as millennials becoming the largest segment, and the impact of the 4 "D's" (death, divorce, dislocation, and downsizing) on demand. They also discuss rising rents despite a decrease in demand, innovative revenue streams beyond traditional storage, and the crucial role of facility management in investment success. Technological advancements and future investment opportunities, alongside considerations like market conditions and customer needs, round out this insightful exploration into the future of self-storage.
Ryan Gibson serves as the co-founder and Chief Investment Officer (CIO) of Spartan Investment Group, specializing in acquiring and developing self-storage facilities. With a track record of organizing more than $200 million in private equity, Ryan oversees investor relations and capital raises for SIG projects. His expertise extends to managing complex developments in diverse markets. Alongside his role at SIG, Ryan brings extensive experience as a commercial airline pilot and holds a bachelor’s degree in Business from Mercyhurst University, with concentrations in Marketing, Management, and Advertising.\
Highlights/Topics:
- Changes in the self-storage industry, changes in the 4 “D’s”
- Specials for first-timers, increases in rent
- Industry stats - less demand, but more revenue
- Millennials are the largest customer segment
- Other revenue streams in self-storage
- Logistics and timing around building new facilities
- Considerations - the market, your customers, raising rents
- Clint’s self-storage investment - facility management is key
- Flipping storage properties
- Challenges and failures, interest rates,
- Tech advancements in the industry
- External access vs. internal buildings in the same facility
- Looking to the future for investing
Resources:
Tuesday Jun 11, 2024
Tuesday Jun 11, 2024
Today on Tax Tuesday, Anderson attorneys Eliot Thomas, Esq., and Amanda Wynalda, Esq. delve into listener questions around inheritance taxes on property and stocks, strategies to minimize capital gains when relocating homes, and the intricacies of 1031 exchanges and syndication investments. Additional topics include LLC taxation, depreciation on rental properties, and the choice between independent contracting and LLC formation in Florida.
Submit your tax question to taxtuesday@andersonadvisors.com
Highlights/Topics:
- Is there any capital gains tax when my son inherits my property or stock? - It depends. With traditional stock it’s fair market value when you pass. There’s no tax to transfer it.
- I'm selling my home in South Florida soon and we like to relocate to North Carolina. I would like to reinvest a portion of a rental property into a rental property and another smaller home when I move to North Carolina. What's the best way to pay the least amount of capital gains taxes after selling my Florida home? - We’re assuming a primary residence, and considering the 121 exclusion. If you lived there 2 of the last 5 years….
- How does a 1031 exchange work? What about a reverse 1031?- If you have an asset used as a rental, not being flipped, you want to defer the gain by buying a “replacement”. Time frames are very strict- 45 days. You need a qualified intermediary.
- If I'm selling a property, all the investors wanna roll their money into a future investment through a 1031 exchange. Is there a legal way to still do a 1031 for the investors that want to participate? - If this is a partnership, that partnership owns the property. It could be changed to a ‘Tenancy in Common’….
- I have recently opened my Wyoming LLC, got up a bank account, a business bank account for the LLC,and funded the LLC out of my personal account. I have since used the deposit of funds to make a limited partnership investment in a syndication, very popular investment. How do I best document these transactions for tax purposes? - Everything goes back to bookkeeping. Troy from our bookkeeping dept says with any capital contributions to the “equity account” for a syndication, you will receive a K1, that you can adjust at tax time based on the loss or gain of the company.
- If my LLC distributes dividends to the partners, do the partners pay tax from the money they receive from the LLC?
- Should I take depreciation on a rental property if I don't have a tenant that year or should I wait until finishing repair? Although it is habitable. I'm a licensed realtor by the way. - When you purchase the property, the building can be depreciated a little bit each year, but land is not depreciable until it is sold. Check out cost segregation and bonus segregation. When it is advertised or posted as “Available for Rent” and truly rentable, that is when you MUST begin taking depreciation. As a realtor, you may aim for Real Estate Professional Status…
- Is it better to work as an independent contractor than to have an LLC in Florida? - Those two things are not opposites. When you're talking about from the tax side, you're usually looking at it being paid as an independent contractor versus being an employee. We look at the pros and cons of this question.
- Would a new start-up with no revenue for the first two years file taxes for those years or only when the third year when the revenue was generated? - If it’s a partnership or C Corp, you may not have to pay taxes if there’s no income. It depends on how your business is set up.
- Additional Q&A listener chat questions are addressed
Resources:
Schedule Your Free Consultation
https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=how-to-avoid-paying-capital-gains-tax-on-inheritance
Bookkeeping Services from Anderson
https://bookkeeping.andersonadvisors.com/
https://andersonadvisors.com/
https://www.youtube.com/@TobyMathis
https://www.tiktok.com/@tobymathisesq
https://www.youtube.com/@ClintCoons
Wednesday May 29, 2024
Wednesday May 29, 2024
Welcome to another Tax Tuesday episode of the Anderson Business Advisors podcast. Today on the show, attorney Toby Mathis, Esq., is joined by Scott Estill, Esq., a former senior trial attorney with the IRS. Scott and Toby dive into how to defer capital gains taxes on real estate with a 1031 exchange and discover the best way to leverage your LLC for tax savings. You’ll hear about maximizing contributions to solo 401ks, deducting startup costs, and the tax implications of fix-and-flipping properties.
Submit your tax question to taxtuesday@andersonadvisors.com
Highlights/Topics:
- 1031 exchange - What are the other options besides investing in one single property and how do I find them? - a 1031 is basically just a way to defer taxes and with proper planning. Up to 200% of the amount is what you can identify as other potential properties.
- As a 1099, what is the best way to leverage my LLC to save money on taxes. How can I save on self-employment taxes? - We need to know what type of LLC you have set up. If you set up an S-Corp, your salary can take out the employment taxes.
- I have a C-Corp that allows reimbursements for medical expenses. Is there a limit to the scope of the type of medical expenses eligible for reimbursement? I plan to reimburse for monthly premiums, plus out-of-pocket co-pays for annual procedures, checkup, etc – Your C-Corp is correct, and you’re limited to what the IRS Pub 502 lists out. (No weed, no cosmetic surgery!)
- I've just set up my entity with you guys, but I've already been doing business. Will I be able to write off startup costs that predate the actual formation of my entity? - You can write off $5K first year, and amortize the rest.
- How do I pay myself from my LLC if it is taxed as a partnership? In other words, what tax forms do I fill out to show the IRS that my LLC paid me for my work? - In a partnership you don’t issue a W2, but you get a “guaranteed payment” - You use a K-1, not a 1099.
- Can you use credit card statements as proof of expenditures? - Be prepared, the statement itself is not sufficient for the IRS, you need an itemized list. Write notes on all your business expenses so you have a record if audited.
- When calculating employer contribution to solo 401k, how does bonus depreciation affect the number? What if I do cost seg and wipe out most my income? Can I make an employer contribution? - Not sure how these elements are related, but the employer could contribute up to whatever you got as wages, period. But they can only deduct 25%.
- Would I be able to donate a property to a nonprofit organization and get the tax right off the sale year if the property was purchased in the same year? - So you have to look at any donation. the calculation here is fair market value on the date of the donation.
- What tax implications, inefficiencies do I need to keep in mind when doing a fix and flip?- There are some pretty serious tax implications if I don't structure the business properly. If you’re doing multiple, you’re a dealer, and you will have self employment tax.
Resources:
Schedule Your Free Consultation
https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=how-do-i-pay-myself-from-my-llc-taxed-as-a-partnership
https://scottestill.com/
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=what-is-the-best-tax-efficient-way-to-purchase-an-existing-business
https://andersonadvisors.com/
https://www.youtube.com/@TobyMathis
https://www.tiktok.com/@tobymathisesq
https://www.youtube.com/@ClintCoons
Tuesday May 21, 2024
Tuesday May 21, 2024
Are you tired of struggling to open a bank account for your business or personal needs? In this podcast, Clint Coons addresses this common challenge and offers a better solution with Barry Sloane, Chairman and CEO of NewtekOne. Before becoming a part of NewtekOne, Mr. Sloane served as the Managing Director at Smith Barney, Inc., overseeing the operations of the Commercial and Residential Real Estate Securitization Unit.
Clint and Barry will shed light on the benefits of opening an account with NewtekOne as the premiere banking option built for businesses. Learn why NewtekOne stands out as a superior choice, offering specialized services tailored to the needs of entrepreneurs, real estate investors, and business owners. Accelerate your journey towards savings goals with a specialized business account tailored for growth.
Learn More about NewtekOne
https://partners.newtekone.com/andersonadvisors/
*Annual Percentage Yields (APYs) advertised are valid as of April 30, 2024, and are subject to change at any time without prior notice. Certain accounts require a minimum and maximum deposit amount required to open an account. Penalties may apply to early withdrawals. Fees may reduce earnings. To learn more, visit NewtekBank.com.
If you are a current Anderson Advisors Platinum Member and would like information about setting up a bank account with Newtek please reach out to your team.
Tuesday May 14, 2024
Tuesday May 14, 2024
Welcome to another Tax Tuesday episode of the Anderson Business Advisors podcast. Today, attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., delve into listener questions around how real estate investors can maximize their returns and navigate the often-overlooked tax benefits associated with oil and gas investments within retirement accounts. They also share valuable tactics for employing family members in a business to shift income and save on taxes. A significant portion of the discussion is dedicated to flipping properties, as they clarify the tax implications of this active income, debate the benefits of cost segregation studies for flips, and advise on the best entity structures to minimize tax burdens. Additionally, the episode covers charitable giving, exploring the differences between donor-advised funds and family foundations, and offering strategic insights for philanthropic tax deductions.
Submit your tax question to taxtuesday@andersonadvisors.com
Highlights/Topics:
- "After seeing one of Toby's videos on five overlooked deductions, my interest in oil and gas investments was piqued. I am wondering if you can use your 401 (k) or a Roth to participate in a partnership. If so, would you get the tax benefits on the front end in year one? If you can do this in a tax advantage account, how is the 15 % depletion credit treated? - Oil and Gas and a retirement account - depreciation wouldn’t really be a factor. Loan the money to yourself.
- “Are US notes bought at a discount in an aftermarket offering exempt from California income taxes?” - Yes they are
- What is the best way to pay your children for a small business owner?“- Pay them from a disregarded entity.
- What are the tax implications when flipping a property, is it? There's three. Is it active income taxed at the ordinary income tax bracket? Another old company Took a while and is there? Stop it. And is there self-employment tax? Where is it? is it beneficial to do a cost segregation study for bonus depreciation for a flip? What is the best entity structure for flips? - Generally, flipping is active/non-passive income. It depends on your material participation.
- How can we offset a W-2 income and lower AGI through real estate investing in rental properties that are potentially fixer-uppers? Can we claim property repair expenses, investments, mortgage interest taxes, et cetera, against W-2 income to lower and offset taxable income?-
- I did a cost segregation study on a fixer property I purchased and rehabbed in 2023, but haven't used it yet because I heard 100 % bonus depreciation might be reinstated. How long is the cost seg study good for since I had it completed in December of 2023? - The cost seg is based on 2023 never expires, you’d be eligible for at least 80%.
- Can I do cost segregation study on Airbnb in a foreign country? - Different countries have different tax rules, but for US tax purposes, it may not benefit you the way you think.
- I want to utilize rental property depreciation to the maximum. However, I held a property for five years and then did a 1031 exchange. I barely get any depreciation to use now. Please explain why what occurs to depreciation when I do a 1031 exchange. Will the original basis carry over to the replacement property? If so, is it accurate to say I get the most depreciation benefit when I buy straight up, not doing a 1031? - the original basis doesn’t carry, but the adjusted basis does.
- What's the best way to transfer the ownership of my investment property to my son before my death? - You can gift it, but we don’t recommend it because they won’t get the stepped up basis to the fair market value. Put it in a living trust.
- How does a donor advice fund differ from a family foundation? - Both are great tools if used for the right purpose. You can invest up to 60% of your AGI in a DAF, or 30% AGI for a family foundation.
Resources:
Schedule Your Free Consultation
https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=how-to-choose-the-best-entity-for-flipping-real-estate
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=what-is-the-best-tax-efficient-way-to-purchase-an-existing-business
https://andersonadvisors.com/
https://www.youtube.com/@TobyMathis
https://www.tiktok.com/@tobymathisesq
https://www.youtube.com/@ClintCoons
Thursday May 02, 2024
Thursday May 02, 2024
Have you ever been caught off guard by the fine print in an insurance policy? Clint Coons, Esq. and Shawn Woedl of National Real Estate Insurance Group uncover the often overlooked details of property insurance that could spell disaster or salvation for your investment portfolio. We dig into the labyrinth of insuring your LLCs and land trusts, as we scrutinize landlord insurance and why it's a whole different ballgame from your typical homeowner's policy. From accidents on vacant lots, fentanyl-related incidents, dog bites, and even snakes in the rafters, Shawn's expertise sheds light on some wild scenarios where the tailored solutions offered by National Real Estate Insurance Group will have you covered.
Shawn Woedl is the President of National Real Estate Insurance Group. He is an industry-recognized speaker and educator with an emphasis on Commercial Property and Premises Liability. He brings over 12 years of professional and personal experience in real estate, business, and insurance to NREIG’s unique, investor-oriented brand.
Highlights/Topics:
- How is landlord insurance different than a homeowner policy?
- Some common policy exclusions you may not know about
- Fentanyl-related claims, toxic mold may be excluded
- Dog bite coverages, breed exclusions, snakes in the rafters!
- Injuries/coverage on vacant land lots
- Beyond primary liability - umbrellas and additional liability coverage
- Coverage for LLCs and land trusts
- “Subject to” property transactions
- Don’t go in ‘blind’ - do your due diligence, or have NREIG do it for you!
- Request a coverage estimate from NREIG with the link below
Resources:
Request a coverage proposal NREIG
https://affiliate.nreig.com/Anderson
https://www.linkedin.com/in/shawnwoedl/
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=why-landlord-insurance-is-vital-for-real-estate-investors
https://andersonadvisors.com/
https://andersonadvisors.com/podcast/
https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w
Tuesday Apr 30, 2024
Tuesday Apr 30, 2024
On today’s Tax Tuesday episode of the Anderson Business Advisors podcast, Eliot Thomas, Esq., is joined by Anderson CPA Barley Bowler. Barley and Eliot will cover some listener questions including strategies around deducting startup costs and choosing a business structure for loan eligibility, tax breaks like depreciation and claiming real estate professional status, paying taxes as a contractor on 1099 NEC forms, and when capital loss carryover deductions can be taken.
Submit your tax question to taxtuesday@andersonadvisors.
Highlights/Topics:
- "I joined Anderson and Infinity Investing in 2023, I established my first real estate investment, C-corporation, in December of 2023 for an official 2024 start date. What, if any expenses, membership, fees, et cetera, do I submit for 2023? ”We started to form the company in 2023. Do I hold out to list everything including the courses, business cards, opening expenses after the fact, or do I add these expenses to 2024?" - After the date of incorporation, everything's expensed as usual. “Pre-incorporation or pre-startup” costs are allowed to be deducted as long as they don't exceed $50,000
- "I've heard we want a pass through real estate holding company that produces a K-1." That'd be a partnership. To enable easier lending on properties in the future. We talk about lendability. How do we get the most favorable lending criteria? Of course, it comes down to the bank, but we're certainly going to be covering that as well about bonus depreciation. We're trying to get a loan on a property. Depreciation is one of these expenses we have to pay attention to.” - in a partnership, as they mentioned here, You're allowed on the federal lending guidelines to have up to 70% of value.
- "We got cost seg and bonus depreciation to offset. Can it offset 1099 income and your social security income?" - If we're talking about a traditional long-term rental, we first need the real estate professional status, then material participation.
- "Hey, my tax is so high. What can I do? How can I reduce it?" - We potentially want to incorporate the business if the numbers are right, then we just look for all available deductions.
- "Why did I have to pay employment taxes when receiving a 1099 NEC?" "I knew I'd have to pay, but it wasn't taken out during the year. I don't have a business, so why do I have to pay taxes?" - an independent contractor form, 1099 NEC, is subject to ordinary income and employment taxes.
- "When selling an investment house like a rental property with some gains, what's the best way to protect our gain without sharing a good part of the check with the IRS?" - This is going to be your 1031 exchange, like-kind exchange.
- "Can capital loss carryovers be chosen when to use?" "Can we pick and choose when we do our losses?" - With capital losses, you can use them up to the amount of capital gains you had plus $3000 that will go against ordinary income.
- "Can I reduce my income tax from capital gains from selling stocks by using a loss in a real estate income or loss business? - If you have your real estate going on, some losses from there perhaps and expenses from that, there are some times where we can use that and times where we can't.
- I just created a business at the end of March." When is it a preferred time to contact a tax specialist and set up a meeting to ask questions, have things explained, and see if we were a good fit for this individual? - If you need some specific guidance or calculations, that's when we may push you to do a billable tax consult or tax planning. In the meantime, hop right into the Platinum knowledge room.
Resources:
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=how-can-a-1099-contractor-reduce-taxable-income
https://andersonadvisors.com/
https://www.youtube.com/@TobyMathis
https://www.tiktok.com/@tobymathisesq
https://www.youtube.com/@ClintCoons
Tuesday Apr 16, 2024
Tuesday Apr 16, 2024
Welcome to another Tax Tuesday episode of the Anderson Business Advisors podcast. Today, attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., explain tax strategies for listener-submitted questions. The conversation digs into S-Corp vs. C-Corp for property management, understanding Unrelated Business Income Tax (UBIT) for non-profits, qualifying for Real Estate Professional status, and cost segregation and bonus depreciation for rentals.
Submit your tax question to taxtuesday@andersonadvisors.
Highlights/Topics:
- "Is it better to have an S-corporation or C-corporation as your property management company managing your land trust and property held in your disregarded LLC? Are you required to have payroll with the S-corporation?" - With the management corporation, S or C, I personally like the C-corporation better.
- “Where and when does UBIT apply to real estate investing and generally to alternative investments? - You're going to run into this when you have exempt groups or we'll call them entities, nonprofits are also exempt.
- Does an accountable plan have identical benefits when comparing a C-corporation versus an S-corporation for a new business?" - being a new business or not shouldn't change too much. It's just a C Corp versus S Corp.
- "How do you know how much you can convert into a Roth IRA from a traditional one without getting pushed into a higher tax bracket when you don't know what your investment gains will be?" - we don't look at the taxable gains - whatever your tax bracket is, that's what’s going to determine.
- “Augusta rule. I am my own real estate broker office scene out of my home. I just hosted a large client appreciation party at my house using rooms in a garden that are not my office. Can I apply an Augusta rule to it? If yes, could applying the Augusta rule increase my chances for an audit and to what percentage? - Augusta rule is 288. You can rent out your home up to 14 times a calendar year. This is entertainment, you could maybe deduct 50%, I wouldn’t use Augusta for anything entertainment.
- “My question is I've never been able to take real estate professional status due to full-time employment as a W-2 employee. I took early retirement on January 2nd of 2024 of this year. I am still being paid the remainder of 2024 biweekly, but not actually working. I'm a licensed real estate broker and spend a lot and most of my time on real estate rentals, subdivision development, et cetera. With this payout biweekly for the remainder of the year, can I qualify as REP (real estate professional) status for 2024?" - The prohibition to having W2 income is if you are actually working at your W2 job. Here, we're not doing any work for that check. You're just getting paid free money for 2024. You can go out and put your time into real estate.
- “Given the time of the year that we're getting into with taxes being due especially in the fall, what are the first three steps in the tax planning process, and how does one approach the process differently for clients that earn less?" – Start with having excellent bookkeeping, identify where you are today, and plan where you are going in the future.
- "What is the best way to purchase an existing business for tax purposes?" - You're going to buy the assets, you want to buy the assets because now you're going to be able to get those at your fair market value that you pay for them. We call it stepped-up basis in your assets…
- "If I buy a short-term rental and do a cost seg the next year, I bought it, and listed it on Airbnb, can I rent it long-term for the following year or would that interfere with the cost seg done the prior year?" –This is a common strategy, there's nothing wrong with that - you want to at least rent it once in year one as a STR.
- "If I claim bonus depreciation on my rental property, do I need to return or reverse it when I sell the property? What happens with bonus depreciation when I sell a rental property, or I necessarily have it in current?” - It depends on the transaction. If you sell a property then you have to have gain. If you don't have gain on the sell, there is no depreciation recapture.
Resources:
Get Your Free Emergency Binder
https://andersonadvisors.com/emergency-binder/
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=what-is-the-best-tax-efficient-way-to-purchase-an-existing-business
https://andersonadvisors.com/
https://www.youtube.com/@TobyMathis
https://www.tiktok.com/@tobymathisesq
https://www.youtube.com/@ClintCoons