Anderson Business Advisors Podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-turn-stock-market-gains-into-tax-smart-investments-in-your-business%20&utm_medium=podcast

https://andersonadvisors.com/strategy-session/?utm_source=how-to-turn-stock-market-gains-into-tax-smart-investments-in-your-business%20&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

3 Secret Ways 529 Plans Can Boost Your Retirement Savings

Wed, 29 Apr 2026 16:29:25 -0300

In this episode, host Toby Mathis sits down with 529 plan expert Chris Stack to explore the surprisingly versatile — and widely misunderstood — ways these accounts can be used far beyond traditional college savings. Chris explains how 529 plans primarily benefit account owners, not just future students, offering tax-free compounding growth, powerful estate planning advantages, and remarkable flexibility in how and for whom funds are used. They discuss how married couples can superfund a single account with up to $190,000 in one contribution, how beneficiaries can be changed to any family member without tax consequences, and how accounts can be structured to grow entirely outside your taxable estate.

Chris also covers the strategy of directing non-educational distributions to lower tax-bracket recipients to minimize taxes, rolling leftover 529 funds into a Roth IRA, bankruptcy creditor protection, and the wide range of qualifying expenses from K–12 through graduate school, trade schools, apprenticeship programs, and nearly 500 international institutions. Tune in to discover how 529 plans can be a powerful, flexible tool for wealth building, legacy planning, and tax strategy at every stage of life.

Highlights/Topics:

00:00 529 expert Chris Stack - most surprising ways people use 529s
02:10 How 529 plans work and their history
06:41 Gifting strategies and estate planning benefits
17:42 Taking money out for non-education expenses
23:05 Investment options costs and choosing a plan
29:46 Eligible expenses and qualifying institutions worldwide
31:41 Three groups who benefit most from 529s
40:43 Overcoming misconceptions and getting started
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Resources

Chris Stack – Saving for College: savingforcollege.com

Chris Stack Email: cstack@savingforcollege.com

IRS Form 709 – Gift Tax Return: irs.gov/forms-pubs/about-form-709

U.S. Department of Education – Eligible International Institutions: studentaid.gov/understand-aid/eligibility/requirements/international-schools

Would you like to learn more about protecting your assets and minimizing taxes? Schedule a free consultation here: https://aba.link/3c7g

Register for a Free upcoming workshop today if you want to protect your business and personal assets from snoopy lawyers and creditors. Save Your Seat: https://aba.link/14g1

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How To Do A Cost Segregation Study When It Saves You Money and When It Doesn’t

Thu, 23 Apr 2026 05:00:00 -0300

In this episode, host Toby Mathis, Esq., welcomes returning guest Chris Streit to break down the truth about cost segregation studies — when they work, when they don't, and who should consider one. Chris explains how cost seg studies accelerate depreciation by separating a property's components into shorter-lived assets, enabling large year-one deductions under bonus depreciation rules. They walk through a real-world example of a $500,000 duplex to illustrate potential tax savings, and discuss who qualifies to use those losses — including real estate professionals versus passive investors.
The conversation also covers the best and worst property types for cost seg, how to use studies to offset rental income across a portfolio, and whether you can apply a study retroactively after a tax year has ended. Chris shares critical red flags to watch for when hiring a cost seg firm, including improper land valuation, lack of site visits, and insufficient substantiation — all of which can expose investors to serious IRS risk. Tune in for expert, no-nonsense guidance on one of real estate's most powerful — and misunderstood — tax strategies.

Highlights/Topics:

00:00 Intro - Bonus depreciation and year one write-offs
04:01 Who should consider a cost seg study
06:06 Example 500K duplex breakdown
10:00 Real estate professional versus passive investors
14:19 Best versus worst property types for cost seg
18:25 Red flags and bad cost seg providers
22:08 Importance of site visits and proper substantiation
25:20 The biggest mistake real estate investors make
27:32 How to get started with a cost seg study
Share this with business owners you know

Resources:

CSA Partners (Chris Streit's company — cost segregation specialists): https://csap.com/

Request a FREE Cost Segregation Benefit Analysis: https://aba.link/594e87

Anderson Advisors Free Workshop (asset protection & business structure): https://aba.link/7gdd

Anderson Advisors
https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How To Claim Missed Depreciation On A Rental Property

Tue, 21 Apr 2026 09:27:01 -0300

In this episode of Tax Tuesday, Anderson advisors Eliot Thomas, Esq., and Barley Bowler, CPA, tackle a packed lineup of listener questions covering construction business accounting, rental property depreciation, and family tax planning. They explain the pros and cons of switching from accrual to cash accounting, and when a SEP or Solo 401(k) can help reduce a tax bill before an extension deadline. They walk through how to claim a college student as a dependent even if the student earns grant income, and how hiring your kids through a C corporation can shift income and fund a Roth IRA.

Eliot and Barley detail how the Ladybird enhanced life estate deed works in the five states that allow it, and how stepped-up basis applies at inheritance. They cover when a management corporation makes sense for short-term rental owners with W2 jobs, the real risk of children's working hours undermining a spouse's material participation, and how the aggregation election simplifies real estate professional status across multiple properties. Other topics include how to catch up missed depreciation using Form 3115, how to properly report an owner-financed note, and whether repairs and maintenance on a non-income-producing rental are deductible. Tune in for expert guidance on these topics and more!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

00:00 Intro to Tax Tuesday with Eliot and Barley

7:09 We file accrual; however, if I switch to cash, the tax bill will be lower. Is this a good idea? Is there anything I can do to lower 2025 taxes before my extension is due in September, like a SEP or retirement plan? - Cash basis is simpler; a SEP or Solo 401(k) can still be established.

16:16 My son gets some grant money from the University for his peer mentor role and research he does. He is a Junior and is 20 years old. Can I still list him as before as a dependent on my tax return? - Yes, if you provide more than half of his total annual support.

21:28 What are the tax ramifications of my brother and I inheriting my mom's home via a Ladybird (enhanced life estate) deed? - You receive stepped-up basis; rental or personal use rules then apply.

27:17 My husband and I both have W2 jobs. We have both long-term and short-term rentals. I manage the STRs. Does it make sense that I open an S Corporation as a management company? Is there an additional advantage to employing my teenage kids to help manage properties? - A C corporation management company maximizes tax-free reimbursement benefits for families.

39:00 We have a home management company (partnership). My spouse qualifies for REP status with no other job. Could he have both? Can you also elaborate on this: "Under §469, each rental property is treated as a separate activity. You must participate in each property. Not just your portfolio as a whole." - An aggregation election bundles all rentals to simplify material participation requirements significantly.

49:05 I have a single-family home rental. Depreciation was not taken on previous tax returns. How do I go back and calculate depreciation? -File Form 3115 to catch up all missed depreciation in one year.

53:50 How do I report the mortgage payment paid to me from my owner finance note? - Report interest received on Form 1098 and installment gain on Form 6252.

57:38 Can you write off expenses and maintenance costs for rentals that are not producing any income due to disrepair? - Yes, if the property remains available for rent or is temporarily out of service.

Resources:

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-claim-missed-depreciation-on-a-rental-property%20&utm_medium=podcast

https://andersonadvisors.com/strategy-session/?utm_source=how-to-claim-missed-depreciation-on-a-rental-property%20&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How To Use A 1031 Exchange When Flipping Houses

Mon, 13 Apr 2026 05:00:00 -0300

In this episode of Tax Tuesday, Anderson attorneys Eliot Thomas, Esq., and Amanda Wynalda, Esq., tackle ten listener questions covering a range of real estate and tax topics. They explain when short-term rentals belong on Schedule E versus Schedule C, and how material participation and substantial services factor into that decision. They explore strategies for mitigating capital gains on rental properties, including 1031 exchanges, Delaware Statutory Trusts, and UPREITs, and clarify why house flippers cannot use a 1031 exchange since flipped properties are treated as inventory. Eliot and Amanda also cover write-off strategies for fix-and-flip investors using a C corporation, grouping rental activity with an operating business to offset income, and deducting stock trading education expenses through startup costs. Additional topics include accountable plans for home office and mileage reimbursements, the difference between contributing funds to a for-profit business versus donating to a nonprofit, reporting the sale of foreign property on a U.S. tax return, and whether a prior-year cost segregation study can still be applied in 2026. Tune in for expert, practical guidance on all of these topics and more!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

[06:08] "Can I file a Schedule E if I'm doing short term rentals?" Avoid substantial services and keep average guest stays over seven days.
[15:49] "How can I mitigate capital gains taxes for rental property if I do not want to hands on operate rentals anymore?" Consider a 1031 exchange into a Delaware Statutory Trust or UPREIT.
[22:38] "How can I get tax write offs on fix and flips?" Use a C corp for deductions through accountable plans and reimbursements.
[26:24] "If I'm in the business of flipping houses, could I use a 1031 exchange to defer my taxes?" No — flipped properties are inventory and not eligible for 1031s.
30:29] "How does grouping work in order to claim losses in a self rental situation?" Group your rental property with your business to offset income with depreciation.
[35:41] "I already purchased stock trading education programs before having any entity set up. How can I deduct those education expenses?" Set up your C corp now; deduct education courses as startup costs.
[39:33] "How can I get reimbursed for a home office, business mileage and other expenses?" Use an accountable plan through your S corp or C corp.
[44:15] "Can you write off or deduct a financial contribution made from your personal account to your for profit business account in the same way you can make a contribution or donation to your nonprofit?" No deduction; contributions adjust your basis and reduce future taxable distributions.
[49:58] "If I sell property abroad, how do I handle the taxes on my US Tax return?" Report on Form 8949, Schedule D; claim a foreign tax credit.
[53:15] "If I had a cost segregation study conducted in a previous year but did not use it, can I still use it in 2026?" Update calculations with your original cost seg firm before filing your return.

Resources:

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-use-a-1031-exchange-when-flipping-houses&utm_medium=podcast

https://andersonadvisors.com/strategy-session/?utm_source=how-to-use-a-1031-exchange-when-flipping-houses&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

The Truth About Infinite Banking And Permanent Life Insurance

Tue, 31 Mar 2026 05:00:00 -0300

In this episode, Toby Mathis, Esq. sits down with insurance expert Caleb Guilliams to break down the truth behind infinite banking and permanent life insurance — and why so much of what circulates online is misleading. They examine how life insurance is routinely oversold as an investment, using Kyle Busch's widely publicized $8 million loss as a cautionary tale about what happens when policies are structured for agent commissions rather than client performance. Caleb explains the three distinct types of life insurance strategies — term, estate planning, and high cash value — and why the vast majority of people should start with term coverage before considering permanent products. Toby and Caleb also walk through how policy loans actually work, including interest rates, repayment flexibility, and the buy-borrow-die strategy as it applies to real estate investors. Additional topics include internal rate of return after all costs, the asset protection advantages of cash value, chronic and critical illness riders as an alternative to traditional long-term care policies, and the red flags that signal a policy has been designed to benefit the agent far more than the client. Tune in for expert insight on how to evaluate, structure, and integrate life insurance as part of a broader financial strategy!

Highlights/Topics:

00:00 Don't believe everything you see online
01:22 Insurance being sold as an investment
02:55 What infinite banking actually is
09:00 Where policies go wrong
13:20 Commissions and hidden costs
18:30 How policy loans really work
23:00 The 3 types of life insurance strategies
31:00 Why most people need term first
38:00 Who life insurance is really for
41:00 Biggest red flags to watch for
45:30 Final thoughts
Share this with business owners you know

Resources:

Guest – Caleb Guilliams / BetterWealth

Have a policy you want reviewed? →https://go.betterwealth.com/tm-review
Want to see if life insurance can better your financial situation? →http://betterwealth.com/tm-call
The AND Asset: The Secret Way to Save And Use Your Money at The Same Time: https://www.amazon.com/Asset-Secret-Save-Your-Money/dp/1732724903

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=the-truth-about-infinite-banking-and-permanent-life-insurance&utm_medium=podcast

https://andersonadvisors.com/strategy-session/?utm_source=the-truth-about-infinite-banking-and-permanent-life-insurance&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

The Tax-Smart Way To Move Real Estate Into A Corporation

Tue, 24 Mar 2026 05:00:00 -0300

In this episode, Anderson attorney Eliot Thomas, Esq., and CPA Barley Bowler tackle a wide-ranging set of listener questions on retirement accounts, real estate strategy, and business tax planning. They explain the key differences between non-recourse and DSCR loans inside a Solo 401(k), and why maintaining non-recourse status is critical to avoiding a devastating unrelated debt financing income hit. They walk through how to properly establish state residency when relocating and cashing out a 401(k), and clarify why donating fully depreciated work trucks to charity won't produce a charitable deduction or avoid recapture. Eliot and Barley also lay out a detailed framework for strategically unwinding a rental portfolio — factoring in passive losses, real estate professional status, and sale timing. They break down the reverse mortgage interest deduction rules for a mixed-use property, explain how insurance proceeds and roof capitalization work after hail damage, and make a strong case for why real estate should always be transferred — never sold — into a disregarded LLC. The episode closes with a warning about Universal Business Organization Trusts, a rarely used entity type that typically surfaces in fraudulent tax schemes and won't generate the refundable NOL investors hope for. Tune in for expert guidance on these and more!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

0:00 — Intro

8:37 — "I want to change from a Solo 401(k) non-recourse SFR loan to a Debt Service Coverage Ratio (DSCR) loan. Any tax implications or penalties to be aware of, particularly considering I'm 67 years old?" - No tax implications exist as long as both loans remain non-recourse.

14:35 — "I lived in Colorado January through March of 2025 and moved to Arizona in April. I had a small 401(k) that I cashed out in October 2025. Taxes were withheld. I understand I will be required to file two state returns. How will I reconcile the 401(k) for both states?" - Establish Arizona residency first; the 401(k) cash-out is taxed only there.

20:25 — "I have a fleet of work trucks that needs to be replaced. Can I donate the trucks to charity to avoid depreciation recapture? Can the charity then sell the trucks tax-free to fund their operations?" - Fully depreciated trucks yield no charitable deduction and no recapture to avoid.

25:08 — "From a tax perspective, what is the most strategic approach to unwind residential rental property?" - Track passive losses per property and time sales to offset income strategically.

32:33 — "I have a reverse mortgage on a 2-unit property where I rent one of the units. Will I be able to deduct the interest when I sell the property? What are the rules regarding reverse mortgages? Anything I should know after 10 years pass?" - Interest deductibility depends entirely on how the reverse mortgage proceeds were spent.

40:05 — "My rental property sustained hail damage that totaled the roof. I replaced it. Insurance paid for most of the work, but did not cover deductibles or roof depreciation. Can I recover those expenses using Federal and State tax codes? I live in California." - Out-of-pocket roof costs are capitalized and depreciated over 27.5 years.

43:58 — "When setting up a corporate structure to hold real estate assets, is it more tax efficient to sell the property to the corporation or just transfer ownership and declare it as startup capital?" - Transfer as a capital contribution; never sell to your own entity.

50:25 — "Can I sell my failing business/LLC to a Universal Business Organization Trust at 'cost basis'? Since the trust has no 'money/income' yet, I believe it will create a refundable NOL. Is that correct?" - No — the LLC's losses already flow through to your personal return.

Resources:

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=the-tax-smart-way-to-move-real-estate-into-a-corporation&utm_medium=podcast

https://andersonadvisors.com/strategy-session/?utm_source=the-tax-smart-way-to-move-real-estate-into-a-corporation&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How To Sell 1031 Replacement Properties Without Tax Penalties

Tue, 10 Mar 2026 05:00:00 -0300

In this episode, Anderson attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., answer listener questions on a wide range of real estate and tax topics. They cover tax benefits available for raw land purchases, including property tax deductions under SALT and investment interest expense on Schedule A. They explain the IRS tax code reference for short-term rentals — IRC Section 469 and Treasury Regulation 1.469-1T — and address special considerations for Airbnb-type rentals in foreign countries, including the mandatory alternative depreciation system (MADS) and foreign tax credits. Amanda and Eliot discuss minimum purchase prices for cost segregation studies and highlight property types like RV parks, car washes, and convenience stores that offer strong bonus depreciation benefits. They tackle the vacation home standard deduction question, clarifying how Schedule E rental properties interact with itemized deductions. The episode dives deep into multiple 1031 exchange questions, including timelines for entering a second 1031, California's clawback provisions on out-of-state replacement properties, and the drop-and-swap strategy for LLC partnerships. They also explain how to navigate delayed IRS refunds using the Taxpayer Advocate Service, and break down the time limits and rules for changing LLC tax status, including Form 8832 and the five-year rule. Tune in for expert advice on these topics and more!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

00:00 — Intro
07:06 — "We recently made a large land purchase. Are there any tax benefits we can claim against our income?" — Deduct property taxes under SALT and investment interest expense on Schedule A.
14:27 — "Is there an IRS tax code reference I can look at for short-term rentals?" — Yes: IRC Section 469 and Treasury Regulation 1.469-1T define short-term rental rules.
18:20 — "Any special considerations for short-term Airbnb-type rentals in foreign countries?" — Use mandatory ADS depreciation; claim foreign tax credits to avoid double taxation.
22:55 — "Is there a minimum purchase price you recommend for STRs? Also, what type of property is ideal?" — A building value of $150,000–$300,000 is an ideal cost segregation starting point.
28:21 — "With today's Individual Standard Income Tax Deduction now so high, how can a Schedule E Vacation Home still be a tax advantage when write-offs no longer exceed the Standard Deduction?" — Schedule E rental deductions are entirely separate from your standard deduction benefit.
35:46 — "I sold one investment property and bought two under a §1031 exchange. When can I sell the two §1031 exchange replacement properties and enter a new §1031 exchange without a tax penalty?" — Hold replacement properties at least two years and thoroughly document your rental intent.
41:15 — "If a property is sold in California in a §1031 exchange and the replacement property in Tennessee is later sold through a second §1031, does California have capital gains taxes that need to be paid?" — Yes; California tracks deferred gains annually on Form 3840 until the tax is due.
44:34 — "If you have an LLC partnership with 3 members that recognized a sale, can each member make their own election with respect to a 1031 exchange? Or must the entire entity participate in the replacement property?" — Use the drop-and-swap strategy carefully; the IRS watches closely for step transactions.
49:15 — "In June of last year, the IRS asked me to submit my previous taxes before receiving my current tax refund. I did so. When I check the IRS website periodically, it says my refund is delayed. I have attempted to call, but no answer from the IRS. How do I expedite receiving my tax refund? Thank you in advance." — Contact the Taxpayer Advocate Service and review your IRS tax transcripts online.
53:18 — "What's the time limit on changing LLC tax status?" — File Form 8832 with an election date up to 75 days back or 12 months forward.

Resources:

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-sell-1031-replacement-properties-without-tax-penalties&utm_medium=podcast

https://andersonadvisors.com/strategy-session/?utm_source=how-to-sell-1031-replacement-properties-without-tax-penalties&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

The 2026 Housing Market Forecast

Thu, 05 Mar 2026 05:00:00 -0400

In this episode, real estate data expert and multifamily investor Neal Bawa returns for the annual 2026 housing market forecast. Neal breaks down the performance of single-family and multifamily asset classes over the past several years, explaining why rents were essentially flat in 2025 and how the ICE workforce crackdown pushed a wave of unfinished inventory into 2026. He outlines why multifamily prices have hit a bottom — down 20–30% from their 2022 peak — and why that represents a buying opportunity, while single-family prices have remained surprisingly resilient due to the mortgage lock-in effect.
Neal also shares his prediction of a rental supply shortage in 2027–2028 that should drive rent growth and occupancy higher, offers frank advice to syndication investors on holding through the downturn, and explains why small interest rate cuts can have an outsized impact on equity. He also introduces AI as a major wildcard that could reshape housing demand beyond 2030. Tune in for data-driven insights and practical takeaways for investors at every level.

Highlights/Topics:

0:00 Intro + welcome Neal Bawa (2026 real estate predictions)
0:34 Single-family vs multifamily explained (Class A/B/C framework)
1:32 Real-world rent drop example: Fresno & Madera inventory surge
2:30 2025 rent growth recap: flat year, concessions, inflation effect
4:36 2026 forecast: supply rolling over, Q1 weak then accelerating rent growth
6:26 Investor question: should you buy now or sit on the sidelines?
7:11 Multifamily vs single-family since 2022: prices, resilience, lock-in effect
10:11 Why single-family cash flow is hardest right now (rates, taxes, insurance)
11:08 Why multifamily is near the bottom + “great time to buy” thesis
13:39 2027–2028 outlook: coming rental supply shortage + rent/occupancy boost
19:50 The AI wildcard: demand, jobs, and what changes after 2030
22:00 Advice for syndication investors: hold, cash calls, protect equity
24:16 Interest rates + equity math: why small rate cuts matter a lot
27:24 The “emotion” factor: sentiment shift and opportunity in 2026
32:00 Wrap-up + Neal’s free webinars at multifamilyu.com/club
Share this with real estate investors you know

Resources:

Multifamily University Investor Club — Free webinars (8/year), no upsell, no subscription https://multifamilyu.com/lp/multifamily-university-investor-club-lp/

Grocapitus — Neal Bawa's investment company https://www.grocapitus.com

Location Magic eBook — Neal Bawa's data-driven market selection resource https://multifamilyu.com/lp/location-magic-ebook/

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How To Structure A Tax-Efficient Management Entity

Tue, 24 Feb 2026 05:00:00 -0400

In this Tax Tuesday episode, Anderson's Barley Bowler, CPA, and Eliot Thomas, Esq., address listener questions on a wide range of tax strategies for real estate investors, business owners, and healthcare professionals. They explain how seller financing affects the ability to use cost segregation and bonus depreciation under IRC Section 465's at-risk rules, and how a single-member LLC can recoup startup education costs through a C Corporation structure with shareholder loans. Barley and Eliot walk through the powerful tax advantages of setting up a management C Corporation over a Wyoming holding company — including medical reimbursements, accountable plan deductions, and W-2 solo 401(k) options. They cover what Medicare premiums and COBRA costs are reimbursable through a C Corp's medical reimbursement plan, how the Section 121 exclusion works for primary residence sales, and what options exist for mitigating a seven-figure business sale gain. Other topics include write-offs for uncollected insurance balances in healthcare practices, avoiding required minimum distributions by rolling into an employer plan, and electing pass-through entity tax in New York for investment partnerships. Tune in for expert guidance on these strategies and more!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

7:18 — "How does the use of seller financing impact the ability to use strategies such as cost segregation and bonus depreciation?" Under IRC Section 465, your deductible losses are limited to the amount you have personally at risk. First phrase: "This is a great question. This covers a lot of different angles."

15:27 — "The business failed to make any profit in year 1. How are those initial costs recouped, and how much can be carried forward to future years?" A C Corp election allows full education deductions; fund via shareholder loan for tax-free recoupment. First phrase: "A single member LLC spent $9,500 on training and other related startup costs."

21:06 — "If I operate one LLC per real estate project, does it make sense to have a separate management entity to deduct shared expenses like an assistant, office costs, business meals, travel, and pre-development work? What's the correct tax structure?" A management C Corporation reduces rental income and allows tax-free reimbursements to the owner. First phrase: "If I operate one LLC per real estate project, does it make sense to have a separate management entity..."

27:45 — "What components of Medicare premiums are reimbursable by my property management C corporation?" Out-of-pocket Medicare and COBRA premiums qualify; general wellness supplements typically do not. First phrase: "What components of Medicare premiums are reimbursable by my property management C Corporation..."

38:10 — "If I sell my house, how long do I have to buy something else before I owe capital gains tax? Do I need to purchase the next home for more than the sale of the house or is there a percentage of that value?" Section 121 excludes up to $250K single or $500K married with no replacement property required. First phrase: "If I sell my house, how long do I have to buy something else before I owe capital gains tax?"

44:45 — "For my healthcare practice, where can I write off balances that insurance refuses to pay, and promotions/certain population deals where I give service discounts or free visits/supplement packages for charity events?" Cash-basis taxpayers cannot deduct uncollected income, and donated services are not tax-deductible. First phrase: "For healthcare practice, where can I write up balances? Insurance refuses to pay."

50:02 — "Can I avoid taking Required Minimum Distributions at age 73, if I roll over my retirement contributions from a previous employer's plan to my current employer's plan?" Rolling into a current employer plan may defer RMDs if you are not a greater-than-5% owner. First phrase: "Can I avoid taking required minimum distributions at age 73?"

53:12 — "Can an investment partnership elect the Pass Through Entity Tax in New York? What are the issues creating/dissolving investment partnerships?" New York allows any partnership to elect PTET, generating a valuable federal-level tax deduction. First phrase: "Can an investment partnership elect the pass through entity tax in New York?"

59:38 — "I sold my company, and I am coming into a 7-figure settlement soon. What can I do with that money to decrease my taxes?" Explore charitable remainder trusts, qualified opportunity zones, and capital loss harvesting strategies. First phrase: "I sold my company and I'm going to come into a seven figure settlement soon."

Resources:

Tax and Asset Protection Events — Live workshop in Las Vegas, March 19–21
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-structure-a-tax-efficient-management-entity&utm_medium=podcast

Schedule Your FREE Consultation — Scan the QR code or visit the link to book your strategy session
https://andersonadvisors.com/strategy-session/?utm_source=how-to-structure-a-tax-efficient-management-entity&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Most Accountants Miss These Two Tax Write-Offs And It’s Costing You Thousands

Tue, 17 Feb 2026 05:00:00 -0400

In this episode, host Toby Mathis, Esq., speaks with returning guest Chris Streit, a cost segregation expert from CSA Partners, about two frequently overlooked tax strategies that can save real estate investors thousands of dollars: Partial Asset Dispositions (PAD) and Qualified Improvement Property (QIP). They discuss how PAD allows investors to immediately expense the remaining value of replaced building components like roofs, rather than continuing to depreciate both the old and new assets simultaneously. Chris explains how QIP enables investors to leverage 100% bonus depreciation on commercial property improvements made after January 19, 2025, including improvements to short-term rentals.
The conversation covers the critical timing of converting long-term rentals to short-term rentals before making improvements, the necessity of cost segregation studies for substantiating these deductions, and real-world applications for various commercial properties including hotels, restaurants, and retail spaces. Toby and Chris also address common concerns about IRS audits and emphasize the importance of working with specialized professionals to maximize these often-missed deductions.

Highlights/Topics:

(00:00) Understanding partial asset dispositions and roof replacements
(07:11) Qualified improvement property explained for commercial assets
(11:18) Converting long-term rentals to short-term
(18:31) Bonus depreciation timeline and audit concerns
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Resources:

📊 Cost Segregation Resources: Request a FREE Cost Segregation Benefit Analysis: https://aba.link/83c5ab Learn more about CSA Partners: https://csap.com/

🎥 Related Videos With Chris Streit:
5 Cost Segregation Mistakes That Trigger IRS Audits: https://youtu.be/1urK1954GS8
Stop Overpaying Depreciation Recapture: The §1245 Move They Skip: https://youtu.be/DBbT2jVG3Js

📚 Download Your Free Resources: Download Your Digital Copy Of Infinity Investing: How The Rich Get Richer And How You Can Do The Same: https://inf.link/efz
Register for an upcoming workshop today to protect your assets from creditors.
Save Your Seat: https://aba.link/6ea4bf

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

1031 Exchange: Pitfalls Real Estate Investors Must Know

Tue, 10 Feb 2026 05:00:00 -0400

In this episode, Anderson attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., tackle listener questions on tax strategies for real estate investors and traders. They explain the tax implications of house flipping, including when to report income and how installment sales affect taxation. Amanda and Eliot discuss transitioning from a disregarded LLC to an S Corporation for managing rentals and flipping properties, emphasizing the importance of avoiding dealer status. They dive deep into 1031 exchange requirements, including timing constraints, qualified intermediaries, and the rules for converting investment property to a primary residence. Other topics include home office deductions versus reimbursements, deducting mileage for consultants with administrative offices, optimal business structures for active stock trading, differences between S and C Corporations, and the tax consequences of using corporate equipment for personal use. Tune in for expert guidance on maximizing tax savings while maintaining compliance!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

[00:00] Intro
[06:26] I purchased a home for $12,000 in 2025 for flipping. Do I show it on my taxes at all or only after I flip? How do I calculate the taxes from flipping? If I want to sell a flip on installments – how does that change the tax? Report only after sale; calculate as ordinary income plus self-employment tax.
[10:02[ What do you recommend to transition from a disregarded LLC to S Corp for managing rentals and doing house flipping as well? Use separate S or C Corporation to avoid dealer status.
[14:10] I'd like to do a 1031 Exchange and eventually move into the property as my primary residence. How quickly can I do that? Wait 24 months with proper rental use before converting to residence.
[19:03] What are some of the pitfalls of a 1031 exchange to focus on? Timing deadlines, qualified intermediary requirement, and boot recognition are critical pitfalls.
[29:28] Can my S Corporation pay rent to me for my home office? And if so, is this considered personal income? Use accountable plan reimbursements instead to avoid taxable rental income.
[33:32] If I am a consultant and take a gig at a company 35 miles from my S-Corporation's administrative office, can I write off the costs to get to the facility on the days I work there? Yes, with administrative office, mileage becomes deductible business travel expense.
[36:41] What's the best business structure setup for active stock trading? Limited partnership with C Corporation general partner provides optimal tax benefits.
[42:19] What are the differences between an S Corporation and a C Corporation for an LLC? S Corporation flows through; C Corporation pays flat 21 percent rate.
[47:25] If I move equipment into my C corporation, can I still use it for personal use? Personal use over 50 percent creates taxable fringe benefit complications.

Resources:

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=1031-exchange-pitfalls-real-estate-investors-must-know&utm_medium=podcast

https://andersonadvisors.com/strategy-session/?utm_source=1031-exchange-pitfalls-real-estate-investors-must-know&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://podcasts.apple.com/us/podcast/the-zero-to-100-real-estate-podcast/id1745322778

https://www.youtube.com/@ClintCoons

How To Build A Real Estate Portfolio Without Cash

Thu, 05 Feb 2026 05:00:00 -0400

In this episode, Anderson attorney Clint Coons, Esq., sits down with real estate investor Gabriel Hamel to explore creative financing strategies for building wealth without traditional bank loans. Gabriel shares his inspiring journey from working minimum wage after military service to acquiring nearly 400 properties using seller financing and no-money-down techniques. They discuss how to structure creative deals, overcome the misconceptions about creative financing, the importance of cash flow over appreciation, and strategies for analyzing deals that work in any market. Gabriel also explains the power of building relationships, finding motivated sellers, and creating win-win scenarios that benefit both buyers and sellers. Clint and Gabriel emphasize the importance of taking action, getting involved in investment communities, and pursuing time freedom through real estate investing. Tune in to learn how you can start building your real estate portfolio even if you have little to no cash!

Gabriel Hamel joined the military at 17 and deployed to Iraq in 2003-2004. After returning home, he found himself working 30 hours a week at minimum wage with dreams of financial freedom. When the 2008 financial crisis eliminated traditional lending options, Gabriel discovered creative financing and seller financing strategies. Starting in 2009 with his first no-money-down deal, he systematically replaced his minimum-wage income and eventually built a $60M portfolio of nearly 400 properties. Today, Gabriel co-hosts the Zero to 100 Real Estate Podcast, helping investors build wealth designed around freedom, family, and choice.

Highlights/Topics:

(00:00) - Introduction to Creative Financing with Gabriel Hamel
(02:08) - First Properties and the 2005-2007 House Hacking Strategy
(06:08) - The 2008 Financial Crisis: When Banks Said No
(07:38) - Debunking Creative Financing Myths and Misconceptions
(10:08) - Finding Motivated Sellers and Structuring Win-Win Deals
(20:15) - Cash Flow vs. Appreciation: Building Sustainable Wealth
(30:45) - Analyzing Deals and Making Offers That Work
(42:49) - The Zero to 100 Tribe: Community and Time Freedom
(45:46) - Taking Action: Final Advice for Aspiring Investors

Resources:

Connect with Gabriel 👇
http://www.zeroto100tribe.com/

https://www.instagram.com/the_real_gabriel_hamel

https://aba.link/0qx

https://aba.link/2f2856

https://andersonadvisors.com/

https://andersonadvisors.com/podcast/

https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w

https://course.infinityinvesting.com/infinity-summit-interest-update

https://andersonadvisors.com/ss/

6 Hottest Real Estate Markets For 2026 (And 6 To AVOID)

Thu, 29 Jan 2026 05:00:00 -0400

In this episode, Toby Mathis, Esq., sits down with 3,700+ unit operator Aaron Adams to discuss the six hottest real estate markets for 2026 and six markets to avoid. They cover the economic factors driving real estate growth, including GDP expansion, potential interest rate decreases, and tax bill impacts. Aaron shares his top picks: Kansas City (benefiting from Oracle's massive $28 billion Cerner acquisition), Idaho Falls (emerging nuclear technology hub), Charlotte (continued banking sector growth), the Winston-Salem triad area (affordability with five universities), and Indianapolis (steady lockstep growth in rents, wages, and prices).
On the flip side, they discuss why to avoid Chicago (high property taxes, population decline), San Francisco (rent controls, tenant protections), Detroit (60% population loss, aging infrastructure), New York City (landlord-unfriendly policies), Los Angeles (high acquisition costs, poor cash flow), and Austin (overbuilt multifamily, high insurance and taxes). They also cover the strategy of investing in smaller cities within 30-40 miles of hot metros to capitalize on growth while maintaining affordability. Tune in for expert insights on where to invest for cash flow in 2026!

Highlights/Topics:

00:00 - Introduction: 2026 Real Estate Market Outlook
01:42 - Economic Convergence: GDP, Interest Rates & Tax Impacts
12:30 - Hot Market #1: Kansas City (Oracle's $28B Acquisition)
17:02 - Hot Market #2: Idaho Falls & Markets to Avoid: San Francisco
23:08 - The 30-Mile Strategy: St. Joseph, MO Example
28:16 - Hot Markets #3-5: Charlotte, Winston-Salem & Indianapolis
35:31 - Asset Allocation Strategy: The 30-30-30-10 Model
40:39 - Markets to Avoid: LA, Austin, Chicago & Detroit
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Resources:

📚 Download Your Free Resources:

Download Your Digital Copy Of Infinity Investing: How The Rich Get Richer And How You Can Do The Same
https://inf.link/efz

🏘️ Connect With Aaron Adams:

REI Kickstart Summit Event

Alpine Capital Solutions

https://alpinecapitalsolutions.com/

Contact Aaron Adams

https://alpinecapitalsolutions.com/contact/

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

100% Bonus Depreciation & Recapture Explained

Tue, 27 Jan 2026 05:00:00 -0400

In this Tax Tuesday episode, Eliot Thomas, Esq., and CPA Barley Bowler address listener questions on diverse tax topics including property management S corporations and QBI deductions. They explain how to structure management companies for rental properties, the relationship between W-2 wages and K-1 distributions, and the power of the 199A qualified business income deduction. Eliot and Barley dive deep into 100% bonus depreciation, cost segregation studies, and depreciation recapture rules—clarifying when to use Section 179 expensing versus bonus depreciation. They also cover maximizing education expense deductions through C corporations, leveraging oil and gas working interest investments for immediate ordinary deductions of 60-85%, structuring private operating foundations with proper payroll procedures, and optimal tax strategies for business sales including the powerful Section 1202 exclusion. Tune in for expert guidance on these advanced tax planning strategies!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

00:00 - Intro
05:34 - "I have a property management S corporation for my rental properties. All rents and expenses are paid to/from the S-corporation. I take a W2 from the corporation. At the end of the year I receive a K1 for the net rental income. Can I take a QBI deduction for this K1?" - The K-1 reflects only the management fee, not rental income. QBI applies to that fee.
14:07 - "I am curious how I can get the maximum benefit from a tax perspective for education class fees paid." - C corporations can deduct new business education via loans from shareholders arrangement.
19:04 - "Please explain 100% Bonus Depreciation recapture and eligible assets with a less than 20 year life being fully depreciated in Year 1." - Cost segregation identifies 5, 7, 15-year assets eligible for immediate bonus depreciation.
24:08 - "What happens if you sell a rental property with depreciation recapture after a cost segregation with bonus depreciation?" - Five-year and fifteen-year property recaptures at ordinary rates; building capped at 25%.
29:46 - "Please explain Section 179 expensing." - Section 179 allows immediate equipment expensing but cannot create a loss situation.
36:20 - "Is oil and gas a good tax deduction?" - Working interest investments provide immediate 60-85% ordinary deductions through intangible drilling costs.
40:36 - "My family has a private operating foundation. One family member works full-time for the foundation and we agreed to pay a wage to that individual. Would that family member have a w-2? Or does the owner withdraw? Also payroll?" - Pay reasonable W-2 wages through payroll; no owner withdrawals in nonprofit foundations.
44:40 - "What is the best tax strategy for selling a business?" - Stock sales create capital gains; consider Section 1202 for qualified small businesses.

Resources:

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=100-bonus-depreciation-recapture-explained&utm_medium=podcast

https://andersonadvisors.com/strategy-session/?utm_source=100-bonus-depreciation-recapture-explained&utm_medium=podcast%C2%A0

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Request a FREE Cost Segregation Benefit Analysis

https://www.youtube.com/@ClintCoons

Your Cost Segregation Will Fail Audit If You Miss These 5 Elements

Fri, 16 Jan 2026 05:00:00 -0400

In this episode, Toby Mathis, Esq., interviews Chris Streit from CSA Partners about the five critical elements that cause cost segregation studies to fail under IRS audit. Chris, whose firm has completed tens of thousands of cost seg reports, reveals that 80% of studies contain fatal flaws that will not survive scrutiny. The conversation covers the importance of establishing proper real estate professional status or short-term rental qualification before taking accelerated depreciation.

Chris explains why land value allocation is the first thing the IRS examines and how it must use county valuation at time of purchase—not rule-of-thumb percentages. They discuss the non-negotiable requirement for physical site visits with video documentation, the necessity of using current RSMeans software with local jurisdiction pricing (not outdated books or averages), and why having accessible audit support is crucial when the IRS comes calling. Chris emphasizes that the burden of proof is on the taxpayer, making professional documentation and expert backup essential. Tune in to learn how to protect your cost segregation deductions and avoid costly audit failures!

Highlights/Topics:

(00:00) - Introduction: Why Your Cost Seg Will Fail
(00:54) - Element #1: Real Estate Professional Status
(02:46) - Element #2: Land Value Allocation
(09:06) - Element #3: Engineered Study & Site Visits
(12:38) - Element #4: RSMeans Cost Data Requirements
(15:39) - Element #5: Audit Support & Accessibility
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Resources:

https://aba.link/vsh

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=your-cost-segregation-will-fail-audit-if-you-miss-these-5-elements&utm_medium=podcast

Learn more about CSA Partners: https://csap.com/

https://csap.com/

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How To Reduce Capital Gains Taxes When Selling A Rental Property

Tue, 13 Jan 2026 05:00:00 -0400

In this episode, Anderson attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., tackle listener questions on reducing capital gains taxes and advanced tax strategies for real estate investors and business owners. They explore the intricacies of cost segregation studies and bonus depreciation versus Section 179, including timing issues for renovations. Amanda and Eliot discuss strategies for minimizing capital gains after decades of depreciation, converting ordinary income to capital gains in development deals, and the tax implications of oil and gas working interest investments. The duo also covers deductible expenses for corporate retreats, entity structuring for piano tuning and bookkeeping businesses, and sophisticated trading partnerships using C corporations. Finally, they take a deep dive into Solo 401(k) contribution limits, explaining the differences between employee contributions, employer matches, and the mega backdoor Roth strategy for maximizing retirement savings. Tune in for expert advice on these and more!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"I purchased a rental and did a cost seg in 2024. I renovated it in 2025. Can I use a cost segregation and/or Section 179 to depreciate the new renovation assets in 2025?" Answer: Yes, bonus depreciation works; 179 has limitations.
[21:16] “How can I reduce capital gains on the sale of a rental property after nearly 27 and a half years? The accelerated depreciation reduced the basis to zero." Answer: 1031 exchange, installment sale, or opportunity zones.
"How can I get capital gains on my K-1 instead of ordinary income on my investment into a real estate developer corporation?" Answer: Development corporations typically generate ordinary income, not capital.
"What expenses for an off-site retreat for an LLC member and officers meeting are deductible? For example, travel, lodging, meals, activities." Answer: Travel, lodging, 50% meals if genuinely business-related.
"If I invest in an oil and gas working interest and I have a first year larger intangible drilling cost loss than is needed for a given tax year based on adjusted gross income, can the excess be carried forward to a future tax year as a net operating loss? Would the NOL have alternative minimum tax implications as well?" Answer: Yes, NOL carries forward; minimal AMT concerns today.
"How do I set up a holding company in California? I want the holding company to own my two companies. One's a piano tuning business and then a bookkeeping business. I have an average income of $125,000 per year combined: $45K for piano, $80K for bookkeeping." Answer: Wyoming LLC holding company owns two California entities.
"I want more information on how I can structure my LLC more efficiently for day trading. What can I do to minimize my taxes for the new year? How can I lower my capital gains tax from day trading?" Answer: Trading partnership with C corporation for deductions.
"Please take a deep dive into Solo 401(k) contributions. What are the individual contribution limits, employer match limits, and especially the voluntary after tax contribution limits. Which components need to be earned income and how does this change if contributing to a Roth 401(k)?" Answer: $72K total; $24.5K employee; mega backdoor uses after-tax.

Resources:

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-reduce-capital-gains-taxes-when-selling-a-rental-property&utm_medium=podcast

https://andersonadvisors.com/strategy-session/?utm_source=how-to-reduce-capital-gains-taxes-when-selling-a-rental-property&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://podcasts.apple.com/ke/podcast/ai-for-business-podcast/id1821570230

https://www.youtube.com/@ClintCoons

AI for Real Estate Investing Find Deals, Market Deals, and Maximize Returns

Fri, 02 Jan 2026 05:00:00 -0400

In this episode, Anderson Business Advisors host Clint Coons, Esq., sits down with Brian Hanson, co-founder of Real Advisors and AI for Business, to explore how artificial intelligence is revolutionizing real estate investing. Brian, who has been teaching business owners and investors about AI and marketing for several years, shares how investors can use AI to crunch massive amounts of data in seconds to identify the most predictable houses likely to sell — something that used to cost $20,000+ from data scientists. They discuss using humanized chatbots and voice bots that can have thousands of personalized conversations simultaneously without sounding robotic, automating follow-up sequences that never miss opportunities, and building custom apps in under five minutes without any coding knowledge. Brian reveals specific tools like Rest Bag for analyzing repair costs at 10 cents per photo, Yellow Pages Scraper for building 20,000-person cash buyer lists for just $80, and browser-use.com for creating custom APIs by simply showing the system what you do manually. As Brian explains, "I just don't think that most people really realize what's possible out there." The conversation covers everything from data mining and lead generation to creating high-converting marketing campaigns using competitive intelligence, virtual staging, and automation tools like Lovable, Google's AI Studio, Air DNA, House Canary, and Semrush. Tune in to discover how AI is the ultimate force multiplier for real estate investors looking to scale their businesses efficiently!

Brian Hanson is the co-founder of Real Advisors and AI for Business. He got his start in real estate in his early 20s working with renowned real estate educator Ron LeGrand, where he developed a passion for marketing. Over the years, Brian has become obsessed with finding smarter, faster ways to grow businesses, and when AI emerged, he immediately recognized its transformative potential. Brian now teaches business owners and investors how to leverage AI to dramatically scale their operations, reduce costs, and increase output. He hosts the AI for Business podcast and regularly conducts three-day intensive training events where he shares cutting-edge AI strategies and tools. Brian's approach focuses on practical implementation—helping entrepreneurs automate processes, eliminate roadblocks, and achieve results they never thought possible.

Highlights/Topics:

(00:00) - Brian Hanson and the AI Opportunity
(05:23) - Finding Off-Market Deals: Data Crunching and Lead Generation
(11:35) - Automating Follow-Up and Conversations with AI
(17:24) - Property Analysis, Contracts, and What AI Can't Replace
(25:19) - Building Custom Apps in Minutes Without Coding
(30:13) - AI-Powered Marketing and Competitive Intelligence
(33:17) - Where to Learn More and Final Thoughts

Resources:

https://www.linkedin.com/in/brian-hanson-1548797

https://www.facebook.com/brian.hanson1?mibextid=LQQJ4d

https://events.aiforbusiness.com/

https://andersonadvisors.com/strategy-session/?utm_source=ai-for-real-estate-investing&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=ai-for-real-estate-investing&utm_medium=podcast

https://andersonadvisors.com/

https://andersonadvisors.com/podcast/

https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w

https://passiveincomepilots.com/

https://andersonadvisors.com/ss/

How Pilots Build Tax-Free Income While Traveling The World

Mon, 29 Dec 2025 05:00:00 -0400

In this episode, Toby Mathis, Esq., of Anderson Business Advisors, interviews Ryan and Tait, hosts of the Passive Income Pilots Podcast and seasoned real estate investors. Ryan has built a $750 million self-storage portfolio while Tait continues flying for a major commercial airline. They share how pilots can build tax-free income while traveling the world through strategic real estate investing, syndications, and debt funds. The conversation covers the biggest mistakes new pilots make with retirement accounts, powerful Roth conversion strategies during probationary years, and how to leverage real estate professional status to offset W-2 income. Tyler and Tait explain how they legally pay almost no federal income tax on nearly $1 million in combined annual income using accelerated depreciation, cost segregation, and oil and gas investments. You'll also hear about whole life insurance strategies, airplane leasebacks for depreciation benefits, and why pilots' largest expense is actually taxes—not housing. Tune in for expert insights on building multiple income streams and achieving financial freedom!

Ryan Gibson is the President, Chief Investment Officer, and Co-Founder of SIG. He has organized over $450M of private equity for Spartan’s projects. Ryan has experience managing the development of SIGs projects in challenging markets. For SIG, Ryan is responsible for investor relations and capital raises for projects. Ryan is also a highly experienced commercial airline pilot. Ryan graduated from Mercyhurst University with a bachelor’s degree in Business, with concentrations in Marketing, Management, and Advertising.

Tait Duryea is the Founder and Chief Executive Officer of Turbine Capital. As an experienced airline captain and third-generation aviator, Tait combines deep industry knowledge with more than a decade of real estate investing experience across single-family, multifamily, self-storage, industrial, mobile home parks, and short-term rentals.

Highlights/Topics:

Best pilot-friendly passive income models: syndications, debt funds, and strategic real estate investing
Biggest mistakes new pilots make: rolling old 401(k)s too quickly and missing Roth conversion opportunities during probationary year
Tax-advantaged real estate: using accelerated depreciation and cost segregation to offset high W-2 income
Real estate professional status: How Tait and his wife legally pay almost no federal income tax on nearly $1 million annual income
Stacking strategies: combining low-income year Roth conversions with discounted LP valuations for maximum tax savings
How one Southwest pilot saved $100,000 in taxes by following podcast education and implementing strategies
Lifestyle creep: Converting purchases into time to make smarter financial decisions and avoid overspending
What separates financially free pilots from those who aren't: continuous education, networking, and disciplined saving
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Resources:

Listen To The Passive Income Pilots Podcast

Learn more about Ryan Gibson and Spartan-Investors

https://spartan-investors.com/

Learn more about Tait Duryea and Turbine Capital

https://www.turbinecap.com/

https://andersonadvisors.com/strategy-session

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-pilots-build-tax-free-income-while-traveling-the-world&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How to Structure Multiple LLCs for Spec Home Building and Lower Taxes

Tue, 23 Dec 2025 05:00:00 -0400

In this Tax Tuesday episode, Anderson Advisors’ Barley Bowler, CPA, and Eliot Thomas, Esq., tackle a wide range of listener questions covering everything from business structures to retirement planning. They discuss the pitfalls of investing in movie production under Section 1801, explain why commuting expenses aren't tax-deductible even for long-distance work arrangements, and clarify the new 1099-NEC reporting thresholds and the upcoming 1099-DA requirements for digital assets. Barley and Eliot break down Section 179 vehicle deductions and the advantages of heavy SUVs over luxury vehicles, explain the reasonable wage requirements and distribution strategies for S corporations, and provide guidance on structuring spec house construction businesses to minimize employment taxes. They also cover mark-to-market elections for traders, the tax consequences of below-market rent to friends or family, and the complications of placing a personal residence in an LLC. Tune in for expert advice on these topics and more!
Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"Any thoughts about investing in movie production for high-income earners?" - Section 1801 expires 2025, creates passive losses, not recommended for most.
"I work for a local government agency in Cochise County, Arizona and live in Maricopa County, Arizona, approximately 215 miles apart. I commute in on Monday, stay in a hotel and leave on Thursday. I've been doing this every week since December of 2024. Is there a tax break deduction for this?" - No deduction available; this is considered commuting, not business travel.
"Is the new 1099-NEC now starting after $2,500?" - Still $600 for 2025; increases to $2,000 in 2026 only.
"Who needs to file this new 1099-DA digital asset form?" - Brokers must send to clients by February 15, 2026.
"I'm a sole proprietor and would like to buy a BMW X7 to save the tax based on section 179. Is it covered?" - Yes, if over 6,000 pounds; 100% write-off available first year.
"I'd like to know the proper ratio of distribution payments to salary within an S corporation." - One-third to 60% of net income is typical rule of thumb.
"Can I pay myself quarterly out of my S corporation LLC?" - Yes, quarterly W-2 payments are acceptable and help avoid penalties.
"What's the best way to structure a business to minimize taxes when building spec houses? I do the majority of the work on the houses, so it looks like a lot of profit on my labor, which is not good. I'm currently structured as a pass through LLC and purchase the house lots in a different LLC from my construction LLC." - Use S corporation for labor; sell land separately at capital gains rate.
"Is it too late for a mark to market election for 2026?" - No, must file on 2025 return by April 15, 2026.
"Is mark to market a good tax deduction?" - Only if trader status qualifies; creates ordinary losses on unrealized gains.
"I'm renting to a friend for $300 a month. Fair market rent would be over $1,500. Any tax consequences?" - Deductions limited to income received; cannot create rental loss at all.
"How can I have an LLC for my personal residence if the house is the residence of both my son and I as joint tenants?" - Possible but risks losing section 121 exclusion and homestead exemption.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=how-to-structure-multiple-llcs-for-spec-home-building-and-lower-taxes&utm_medium=podcast
Tax and Asset Protection Events

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-structure-multiple-llcs-for-spec-home-building-and-lower-taxes&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Real Estate’s Biggest Tax Loophole: Cost Seg + 1245 Exchange Explained

https://www.youtube.com/@ClintCoons

4 Big Changes for Real Estate Investors Under Trump’s Big Beautiful Bill (2 Are BAD!)

Thu, 18 Dec 2025 05:00:00 -0400

In this episode, Toby Mathis, Esq., interviews Chris Streit, a tax incentive and cost segregation expert, about four major changes for real estate investors under Trump's One Big Beautiful Bill. Chris explains how energy tax credits like 45L (residential) and 179D (commercial) are sunsetting on June 30, 2026, offering up to $5,000 per door for qualifying new construction. They discuss the brand new Qualified Production Property (QPP) provision that allows manufacturers to expense up to 70% of facility costs with zero recapture if held for 10 years—a game-changing opportunity for production facilities. The conversation covers the return of 100% bonus depreciation for properties acquired and placed into service after January 19, 2025, and how this creates immediate tax benefits for residential and commercial real estate investors. Chris and Toby also explore how investors who purchased properties before January 19th can still benefit from 100% bonus on improvements made after that date. Tune in for expert insights on maximizing these tax strategies before key provisions expire!

Chris Streit is the Chief Executive Officer of CSA Partners, a firm specializing in tax services like cost segregation, known for leading with operational excellence, customer-centricity, and driving significant growth in areas like tax incentives for real estate. He's a seasoned executive with decades of experience in finance, investment, and leadership, having previously worked at major firms like Merrill Lynch and Bridgewater Associates.

Highlights/Topics:

Energy tax credits 45L and 179D are sunsetting June 30, 2026—builders can still get up to $5,000 per door for new construction meeting Energy Star requirements
179D commercial energy deduction offers $5.80 per square foot for properties with construction starting before January 2023, exempt from prevailing wage requirements
Qualified Production Property (QPP) allows manufacturers to expense up to 70% of facility costs with zero recapture if held 10 years—a permanent tax reduction
100% bonus depreciation is back for properties acquired and placed into service after January 19, 2025, creating immediate first-year tax benefits
Properties purchased before January 19th still eligible for 100% bonus on improvements made after that date, though original purchase uses old rates
One client discovered $30 million in overlooked 179D benefits on a 5.1 million square foot property that started in 2021
QPP creates new manufacturing incentives by expensing facility costs without recapture, making production facilities extremely attractive for investors
Cost segregation studies paired with bonus depreciation can generate immediate tax savings worth 7-10x the cost of the study
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Resources:

Request a FREE Cost Segregation Benefit Analysis https://aba.link/ka3

Learn more about CSA Partnershttps://csap.com/

Stop Overpaying Depreciation Recapture: The §1245 Move They Skip

https://youtu.be/DBbT2jVG3Js

https://youtu.be/JYKo34_n8yU

https://andersonadvisors.com/strategy-session/?utm_source=4-big-changes-for-real-estate-investors-under-trumps-big-beautiful-bill&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=4-big-changes-for-real-estate-investors-under-trumps-big-beautiful-bill&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Can You Use Retirement Money for a Condo Without the Penalty?

Wed, 10 Dec 2025 05:00:00 -0400

In this episode, Anderson CPA Barley Bowler and attorney Eliot Thomas, Esq., tackle year-end tax planning strategies and answer listener questions on a variety of critical topics. They explain the new rules for research and development cost deductions following recent legislation, including the choice between immediate 100% deduction or five-year amortization for domestic R&D. Barley and Eliot cover the 72T procedure for penalty-free early IRA withdrawals, the strategic benefits of qualified opportunity zone investments for deferring capital gains, and how to use IRA funds without penalty for first-time home purchases. They discuss the complex rules for deducting expenses on mixed-use vacation homes, calculating tax-free administrative office reimbursements, and essential year-end action items including payroll, bonus depreciation, solo 401K contributions, and charitable giving strategies. Tune in for expert advice on maximizing deductions before December 31st!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"What are research and development costs? How are they deducted?" - Domestic R&D costs can now be 100% deducted immediately.
"What expenses that I incur on behalf of my employer can I deduct on my personal 1040 tax return?" - Very limited options exist; reimbursement from employer is best approach.
"Can you please explain what a 72T procedure is?" - Take equal IRA distributions before 59.5 without 10% penalty.
"I am considering investing in an opportunity zone fund to defer capital gains. What are some top items I should be thinking about?" - Consider fund structure, compliance requirements, and ten-year holding period benefits.
[33:35] Title Question "How can I be exempt from paying the IRS the penalty of using my retirement money to buy a condo?" - First-time homebuyers can withdraw $10,000 from IRA penalty-free.
"Are expenses such as real estate property taxes and home improvements deductible on vacation homes that are used both for personal and rental purposes?" - Personal use over 14 days limits deductions to rental income.
"I'm attempting to calculate the reimbursements for our administrative office. How do I calculate, how much can I reimburse myself for tax-free every year?" - Calculate square footage percentage times home expenses for reimbursement amount.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=can-you-use-retirement-money-for-a-condo-without-the-penalty&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=can-you-use-retirement-money-for-a-condo-without-the-penalty&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Can You Do A Cost Segregation Study On Property In A Qualified Opportunity Zone Fund?

Tue, 25 Nov 2025 05:00:00 -0400

In this episode, Anderson Advisors Barley Bowler, CPA, and Eliot Thomas, Esq., tackle listener questions on critical tax strategies. They cover the differences between Section 179 expense deductions and bonus depreciation, including how to combine them effectively and avoid creating excessive losses. Barley and Eliot discuss the timing of equipment purchases for tax planning purposes and explain the complexities of equipment leasing investments, emphasizing the importance of material participation tests. They address the mark-to-market election for active traders and explain why Anderson doesn't recommend this strategy due to audit risks. The attorneys clarify that qualified charitable distributions can only be made from IRAs, not Solo 401(k)s, and explore strategies for using IRA withdrawals to purchase rental properties while offsetting taxes through cost segregation studies. They also explain excess business loss limitations, the interaction between cost segregation studies and qualified opportunity zone funds, and why 1031 exchanges cannot be used to avoid capital gains tax deferrals ending in December 2026. Tune in for expert guidance on these advanced tax topics!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"How can I take advantage of tax code 179, Section 179?" - Section 179 allows immediate deduction of qualifying business equipment expenses.
"If I have more business items to buy like a desk, should I buy them before the end of the year? Or maybe I wait to the new year? When do I buy these things?" - Purchase timing depends on which year needs the deduction more.
"If one invest in an equipment leasing investment in 2025, and it's active, and writes off 100% of the equipment cost in 2025, but then in 2026 no longer active, does the income revert to passive income or is it still active for 2026?" - Active losses remain locked in; only future income becomes passive.
"Can I still take the IRS mark-to-market election for the tax year starting January 1st 2026?" - Election must be made on 2025 return by April 15th.
"I have a Solo 401(k). First of all, how does this work? And can I make qualified charitable distributions from my Solo 401(k)? Plus do these tax-free distributions go on my 1040 as a deduction?" -QCDs only work from IRAs, not Solo 401(k) retirement plans.
"Is there a cap on how much money I can withdraw per year from my traditional IRA to purchase an income-producing rental property? What are the things I need to consider before making this decision? I'm 55 years old and I am aware of the 10% penalty." - No cap exists; expect regular income tax plus 10% penalty.
"Is there an annual cap on bonus depreciation? Is there a limit on how much bonus depreciation we can take?" - Excess business loss limitation caps deductions at $313,000 single, $626,000 married.
(44:44) Title question "Can I do a cost segregation study on a property that's in a qualified opportunity zone fund? How does this impact the capital gains tax deferral that ends in December of 2026?" - Yes; cost seg helps operations but doesn't offset deferred gains.
"Can I do a 1031 exchange and avoid the tax due when the deferred tax comes due in 2026?" - No; cannot use 1031 to avoid QOZ deferred capital gains.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=can-you-do-a-cost-segregation-study-on-property-in-a-qualified-opportunity-zone-fund&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=can-you-do-a-cost-segregation-study-on-property-in-a-qualified-opportunity-zone-fund&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

S-Corp vs. Sole Proprietor When Should You Switch to an S-Corp

Tue, 11 Nov 2025 05:00:00 -0400

In this Tax Tuesday episode, Anderson attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., tackle listener questions on choosing the right business structure and maximizing tax savings. They explore when to switch from sole proprietor to S-corporation status, explaining the sweet spot for making the transition and the significant tax benefits available through S-corps versus Schedule C filing. Amanda and Eliot dive deep into house flipping strategies using C-corporations to avoid dealer status and self-employment tax while maximizing deductions through accountable plans and bonus depreciation. They clarify the complexities of 1031 exchanges, especially when properties are held in partnerships, and introduce the "lazy 1031" strategy for offsetting capital gains using passive activity losses. The duo also addresses managing multiple LLCs without creating excessive tax filing burdens, deductions available for nonprofit volunteer work, and creative ways to fund retirement accounts through trading partnerships. Whether you're a truck driver looking to reduce your tax burden or an investor navigating 1031 exchange rules, this episode delivers expert guidance on structuring your business for maximum tax efficiency!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"I have a trading partnership with 40% C-corporation and 60% myself for ownership. The partnership makes around $20,000 in ordinary staking income." We're going to be talking about Bitcoin. "Can the C-corp use its $8000 in income to fund a 401(k) owned by the corporation since this is ordinary income?" - Yes, use solo 401(k) or tax-free reimbursement strategies instead.
"What kind of deductions can I use as a C-corporation to offset capital gains from a house flipping?" - House flipping creates ordinary income, not capital gains, offset accordingly.
"If I have multiple LLCs, do I have to file multiple tax returns?" - It depends on entity type and how they're connected.
"I am a sole proprietor, independent truck driver, and I feel I'm paying very high taxes. What can I do?" - Consider switching to S-corp for self-employment tax savings at scale.
"My tax preparer says, don't switch to an S-corp. Make an S-election until your revenue hits a hundred thousand dollars. Why is that? And how will an S-corp help me?" - S-corps save self-employment tax but add compliance costs and complexity.
"If a property purchased via 1031 exchange is held in an LLC partnership, can it be converted to personal use like a personal residence after two years? If so, what are the tax implications?" - Extremely complicated; partnership ownership creates significant tax issues and barriers.
"How may I pay no capital gain without a 1031 exchange?" - Use the lazy 1031 strategy releasing suspended passive losses.
"If I volunteer my work or my time at a nonprofit agency, are there any tax deductions that I can take?" - Personal time isn't deductible, but mileage and expenses are.

Resources:

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=s-corp-vs-sole-proprietor-when-should-you-switch-to-an-s-corp&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=s-corp-vs-sole-proprietor-when-should-you-switch-to-an-s-corp&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

The #1 Killer in America: How to Prevent Cardiovascular Disease

Tue, 04 Nov 2025 05:00:00 -0400

In this special episode, tax attorney Toby Mathis, Esq., shifts focus from financial health to physical health by welcoming William Donovan from the Pritikin Longevity Center to discuss America's number one killer: cardiovascular disease. William shares his personal story of reversing heart disease and eliminating the need for bypass surgery through lifestyle changes at Pritikin, explaining how their medically supervised program has helped thousands achieve remarkable health transformations. The conversation covers the alarming statistics showing that 50% of heart attack victims had normal cholesterol levels, the critical role of endothelial function and arterial plaque, and why traditional risk factors don't tell the whole story. William explains the Pritikin Program's three-pillar approach, combining a whole-food, plant-based diet low in calorie density, daily exercise routines including resistance training, and comprehensive lifestyle education. They discuss how participants typically see dramatic improvements in just two weeks - lowering cholesterol by 23%, reducing blood pressure, eliminating medications, and reversing diabetes. With insights on inflammation, the dangers of processed foods and added oils, and the importance of getting professional medical guidance, this episode provides actionable strategies for anyone concerned about heart health, especially business owners and investors who need to protect their most valuable asset: their health.

Highlights/Topics:

0:00 Heart Disease Statistics and Personal Story
3:40 What Pritikin Does and Nathan Pritikin's Story
12:45 Opening the Center and 60 Minutes Validation
19:40 What Happens in One to Two Weeks at Pritikin
30:20 The Challenge of Getting Healthy in Modern Society
36:45 Inspiring Success Stories
39:20 GLP-1s vs Lifestyle Change
42:50 Three Big Myths About Heart Disease
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Resources:

https://andersonadvisors.com/strategy-session/?utm_source=the-number-1-killer-in-america&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=the-number-1-killer-in-america&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Live Event in Dallas Dec 4-6 2025

https://www.youtube.com/@ClintCoons

How to File Taxes as a Single-Member LLC

Tue, 28 Oct 2025 05:00:00 -0300

In this episode of Tax Tuesday, Anderson advisors Barley Bowler, CPA, and Eliot Thomas, Esq., address listener questions on tax topics ranging from basic bookkeeping to advanced ESOP strategies. They cover essential bookkeeping practices for first-time rental property owners and the tax implications of transferring a fully depreciated truck from an S corporation to personal use. Barley and Eliot explain how to catch up on missed depreciation from prior years, the tax benefits of inheriting property versus receiving it as a gift, and how independent contractors should handle federal income and employment taxes. Other topics include choosing the best filing structure for single-member LLCs, tax reduction strategies for Schedule C solopreneurs earning over $100K, deferring traditional IRA distributions using Qualified Longevity Annuity Contracts (QLACs), and the little-known 1042 fund strategy for deferring taxes on ESOP distributions. Tune in for practical tax advice and strategies to keep more of what you earn!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"What's the most efficient way to get my books ready for filing taxes? I'm filing taxes for my first time rental business. I just acquired them this year. I'm a first time landlord without bookkeeping experience." A: Use bookkeeping software and categorize expenses properly throughout the year.
"My S corporation owns a fully depreciated truck. Can I transfer the truck to my personal name and start taking mileage reimbursement instead? What are the tax implications?" A: Yes, but you'll recognize income equal to fair market value.
"For the eight years now, my prior taxpayer never took depreciation for any of my rental properties or my property assets for the building, along with the components like the water heater. What do I do now?" A: File Form 3115 for a change in accounting method.
"I'm considering moving into my parents' home while they're still living there. I'm curious about the best way to either transfer the house into my name or should I stay there and wait until they pass because they intend to leave the house to me anyway." A: Wait for inheritance to receive stepped-up basis and avoid gift taxes.
"How do I pay federal income and employment taxes working as an independent contractor receiving a 1099?" A: Pay quarterly estimated taxes using Form 1040-ES throughout the year.
"What tax filing structure do you recommend for a single-owner LLC wanting to not be a disregarded entity? Why? Pros and cons of the options." A: Consider S corporation for self-employment tax savings if income supports it.
"I'm a Schedule C solopreneur looking for ways to avoid being overtaxed. I made over $100K this year and I'm the only breadwinner in my family of four with two kids under 18. We're in Florida. What do you recommend for ways to lower my taxable income?" A: Establish S corp, maximize retirement contributions, and utilize business deductions.
"Is there any way to defer for tax reporting a distribution from my traditional IRA? I recently heard someone talking about this and was not sure if they were referring to a Qualified Longevity Annuity Contract (QLAC)." A: Yes, QLACs allow deferring up to $200K until age 85.
"How does a 1042 fund work? I've never heard of that." A: It defers ESOP distribution taxes by reinvesting in qualified replacement stock.

Resources:

Guns and Estate Planning What Every Family Needs to Know

Tue, 21 Oct 2025 05:00:00 -0300

In this episode, tax attorney Toby Mathis, Esq., welcomes Tom Chittum, former ATF Deputy Director and firearms law expert, to discuss the critical intersection of firearms ownership and estate planning. They explore what families need to know when inheriting firearms, from identifying contraband weapons to navigating complex federal regulations. Tom explains the biggest mistakes executors make, including informal transfers and failing to determine whether firearms, such as machine guns, are properly registered under the National Firearms Act of 1934. The conversation covers the distinction between regular firearms and NFA weapons (machine guns, silencers, short-barreled shotguns), the severe criminal penalties for unlawful possession, and the importance of working with federal firearms licensees for transfers. Tom provides practical guidance on securing firearms, maintaining proper inventories, using gun trusts to simplify inheritance, and understanding both actual and constructive possession. With insights from decades of ATF experience, Tom offers actionable steps gun owners can take today to protect their families from legal headaches and ensure valuable firearms or family heirlooms don't become government-destroyed contraband due to simple mistakes.

Highlights/Topics:

0:00 Why Listen to Tom Chittum
2:58 Biggest Mistakes with Firearm Inheritance
6:20 History of Federal Gun Laws
8:36 Legal Possession and Registration Requirements
11:30 Prohibited Persons and Transfer Restrictions
12:59 How to Transfer Firearms to Heirs
15:30 NFA Firearms and Special Requirements
18:35 Gun Trusts and Estate Planning
22:29 Executor Rights and Possession
24:31 Securing Firearms in Estates
25:51 Handling Contraband Firearms
28:50 Weekend Action Steps for Gun Owners
31:00 Outro
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Resources:

https://andersonadvisors.com/strategy-session/?utm_source=guns-and-estate-planning-what-every-family-needs-to-know&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=guns-and-estate-planning-what-every-family-needs-to-know&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Real Estate’s Biggest Tax Loophole Cost Seg + 1245 Exchange Explained

Thu, 16 Oct 2025 05:00:00 -0300

In this episode, tax attorney Toby Mathis sits down with Chris Streit, CEO of CSA Partners, to dive deep into cost segregation studies and how they can dramatically improve cash flow for real estate investors. They explore the biggest mistakes investors make with depreciation, explaining how the IRS treats properties as single assets when they're actually composed of multiple components that depreciate at different rates. Chris breaks down the mechanics of cost segregation studies, revealing how even a $200,000 rental property can generate $40,000 in year-one deductions instead of just $5,000-$6,000 annually. The conversation covers the impact of the One Big Beautiful Bill's reinstatement of 100% bonus depreciation, the differences between engineered studies versus software-generated reports, and strategies for minimizing depreciation recapture through 1245 exchanges. With over 20,000 studies completed and minimal audit issues, Chris provides expert guidance on audit-proofing returns, maximizing tax savings throughout the property lifecycle from acquisition to sale, and debunks common myths about depreciation timing and syndication eligibility.

Highlights/Topics:

0:00 Biggest Mistake Real Estate Investors Make
5:15 Why Regular Investors Should Care About Cost Segregation
8:45 What is a Cost Segregation Study
12:20 Real Life Cash Flow Examples
15:30 Engineering Studies vs Software Studies
20:45 Audit Concerns and IRS Statistics
25:10 One Big Beautiful Bill and Bonus Depreciation
30:15 Depreciation Recapture and 1245 Exchanges
35:40 Cost Segregation and 1031 Exchanges
38:20 Advice for Investors
40:50 Cost Segregation on Syndications
42:30 Biggest Myths About Depreciation
44:15 Closing Thoughts
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Resources:

Learn more about Ryan Gibson and Spartan-Investors https://spartan-investors.com/

https://andersonadvisors.com/strategy-session/?utm_source=real-estates-biggest-tax-loophole-cost-seg-1245-exchange-explained&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=real-estates-biggest-tax-loophole-cost-seg-1245-exchange-explained&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

The Big Beautiful Bill Benefits Every Small Business Should Know

Tue, 14 Oct 2025 05:00:00 -0300

In this episode of Tax Tuesday, Anderson attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., tackle a diverse range of tax questions from listeners. They discuss oil and gas investments used to offset Roth conversion income and explain excess business loss limitations. Amanda and Eliot clarify filing requirements for C-corporations with losses, emphasizing that corporations must file regardless of activity. The team explores multiple scenarios involving converting short-term rentals to primary residences or vacation properties, covering Section 121 exclusions, depreciation recapture, and the strategic use of S-corporations to step up basis. They present creative alternatives to 529 plans, including paying children through family businesses to fund education tax-free. Eliot and Amanda also review key provisions of the One Big Beautiful Bill Act affecting small business owners, including permanent QBID, enhanced bonus depreciation, and the SALT workaround. Finally, they demystify passive loss limitations, explaining the hurdles of basis, at-risk rules, and passive activity loss restrictions that syndication investors commonly face.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"I've made a Roth conversion earlier this year and am currently in the process of doing another conversion. We have invested in oil and gas to help offset taxes due. Is there a concern that we've invested too much?" - Excess business loss limits apply but unused losses carry forward.
"I have not had any activity in my C-corporation and it had $26,000 of loss, and had some expenses. Do I still need to file an 1120 corporate return?" - Yes, corporations must file tax returns regardless of activity level.
"We're thinking of taking our short-term rental out of service and moving into it as our primary residence. What are the tax implications if we sell our existing primary residence?" - Section 121 excludes up to $500,000 gain on primary residence sale.
"Same scenario with short-term rental and primary residence, but we're turning our existing primary into a short-term rental instead of selling it. What are the implications?" - Basis transfers to rental, depreciate building over 27.5 years going forward.
"Same scenario with short-term rental and primary residence, but we're converting one property into a vacation home with no rental activity. What happens?" - Personal vacation homes lose business deductions, only Schedule A applies.
"We do not have any education savings set up for our son who is now a junior in high school. Is there any other option to pay for college pre-tax? Most of our income is from rentals." - Pay child W-2 wages through rental LLC under standard deduction amount.
"Would you please go over some of the benefits of the Big Beautiful Bill for small business owners?" - Permanent QBID, 100% bonus depreciation, SALT workaround, enhanced Section 179 available.
"A lot of time you talk about taking passive losses from syndications to offset passive income. However, I've encountered passive loss limitations where about two-thirds of losses have been disallowed due to basis, at-risk limitations, or excess business loss. Would you please explain how and why losses are being limited?" - Three hurdles exist: basis, at-risk, and passive activity loss rules.
"What expenses are incurred for rental properties that are tax deductible and what is the best way to stay organized when keeping records?" - Reference IRS Schedule E page one for complete deduction list.
"How do we properly track and maximize deductions across multiple rental properties while maintaining compliance?" - Maintain separate books per property, use accounting software regularly.RetryClaude can make mistakes. Please double-check responses.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=the-big-beautiful-bill-benefits-every-small-business-should-know&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=the-big-beautiful-bill-benefits-every-small-business-should-know&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

A Beginner’s Guide to Cost Segregation Studies

Wed, 01 Oct 2025 05:00:00 -0300

In this episode of Tax Tuesday, Anderson advisors Barley Bowler, CPA, and Eliot Thomas, Esq., tackle listener questions covering essential tax strategies for real estate investors and business owners. They explain how LLCs holding investments should be taxed, breaking down the differences between disregarded entities, partnerships, and corporations. They walk through complex scenarios including calculating capital gains on homes with mixed personal and rental use, including non-conforming use periods and depreciation recapture. Barley and Eliot discuss strategic tax planning for cryptocurrency gains, maintaining disability benefits while generating passive income, and the mechanics of cost segregation studies for accelerating depreciation deductions. They also cover creative strategies like the daughter's stock trading scenario using the 0% capital gains bracket, finding passive income to offset accumulated passive losses, and using nonprofits for tax savings. Throughout the episode, they emphasize the importance of proper structure and timing to maximize deductions while staying compliant.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"Should my LLC holding investments file as a C or an S corporation or with my individual 1040?" - Disregarded LLC on personal return; corporations for active business only.
"We are selling our personal home with acreage for considerable gain. How do I figure out which percentage of capital gains we will owe? Zero 15. 20. And how can we decrease the amount of capital gains we will owe?" - 0%, 15%, or 20% based on taxable income brackets after exclusions.
"My daughter trades stocks and has low earned income. If she closes positions at a profit that were held over a year, the capital gains remain untaxed provided her net taxable income is below the threshold. Can she close in a profit and reopen the same position year after year? Can that be ongoing to avoid any tax?" - Yes, if total taxable income stays below threshold annually.
"What is the best asset protection entity structure to be in that will save on taxes with gains in cryptocurrencies?" - Trading partnership with 90/10 split and C corporation for efficiency.
"I'm a disabled nurse collecting social security disability. I'm considering an LLC as an asset holding company. How can I make it so the distribution and salary are passive so that I don't lose my benefits?" - Use disregarded LLC; dividends and capital gains typically don't affect disability.
"Can you please explain a cost segregation study?" - Accelerates depreciation by reclassifying building components into shorter-life assets for upfront deductions.
"I have a house I lived in for three years, rented for five years, moved back in two years ago. How does the rental depreciation and recapture gain work on my tax return if I sell it?" - Apply Section 121 exclusion; 50% non-conforming use affects gain calculations.
"What types of passive income could I invest in to offset my accumulating passive losses?" - Limited partnership interests in businesses generating profits, not portfolio income like stocks.

"Would you please explain how nonprofits are used to save on taxes?" - Itemized charitable donations create deductions; funds must serve nonprofit purposes only.

Resources:

https://andersonadvisors.com/strategy-session

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/@ClintCoons

PadSplit & Co-Living vs. Short-Term Rentals Do the Tax Breaks Match

Wed, 17 Sep 2025 05:00:00 -0300

ode of Tax Tuesday, Anderson attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., tackle a diverse range of tax questions from viewers. They explore the differences between PadSplit/co-living models and short-term rentals, explaining why PadSplit typically doesn't qualify for the same tax advantages as short-term rental activities. The duo covers entity formation costs and how they're treated for disregarded LLCs, the importance of proper documentation for independent contractor payments including W-9 forms and 1099 requirements, and cryptocurrency taxation for long-term holders. They also discuss offsetting bond interest with stock losses, wash sale rules for options trading, 1031 exchange strategies including improvement exchanges to minimize boot taxation, and comprehensive guidance on real estate professional status requirements. The episode concludes with settling a marital dispute about whether primary residence maintenance counts toward real estate professional status hours.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"Are the fees for disregarded LLCs taxable on the business return or the personal return?" - Fees follow the entity's disregarded destination and activity type.
"Will the PadSplit/co-living model give you the same tax advantage as a short-term rental?" - No, PadSplit typically doesn't qualify for short-term rental benefits.
"Last year I purchased a three-level eight-bedroom house with one kitchen and one bathroom on each floor. I rent the floors as separate apartments except for one level where I have two rooms rented separately. I put the house in service on January 25. I listed it as my primary residence. I never actually lived there. Can I perform a cost segregation, take advantage of bonus depreciation, et cetera?" - Yes for cost seg, but homestead fraud concerns exist.
"I paid freelancers to put up a fence last year. I didn't get a receipt. Can I write off any of the costs of this fence? I used my company credit card or bank checks to conduct business with vendors and stores. I am bad at keeping receipts. But I print my bank statements. Can I use my statements as proof of purchase for tax purposes?" - Bank statements help but proper W-9s and 1099s are required.
"I will be receiving profits from the sale of cryptocurrency investments that I've had for five years. I'm retired and receive social security as my only income. How will this crypto be gained from an IRS perspective?" - Taxed as capital gains, likely at fifteen percent rate.
"Can interest gained on a US savings bond be offset with the loss on a stock sale for tax purposes?" - Yes, up to three thousand annually against ordinary income.
"If I sell a stock at a loss and purchase calls instead, do I lose my loss benefit as if I had repurchased more stock within the 30 day period? Or in simpler terms, are calls treated the same as stock?" - Yes, calls typically trigger wash sale rule provisions.
"We did a 1031 exchange with the building we own, but the place that we bought the replacement property was 250,000 cheaper. How do we minimize our capital gains on the leftover money? I know we can use capital improvements that we've made, but what are the rules and how must we document the improvements? Likewise, can we use depreciation schedules from the prior returns for the new tax returns?" - improvement exchanges must occur during exchange.
"I wanna know more about the tests for real estate professional status as a way to deduct expenses from other passive income. I understand that I need 750 hours, but this is very loose and I'm not sure how it is audited exactly." - 750 hours plus fifty percent test, requires detailed documentation.
"Please settle this one thing that my husband and I disagree on, I say that maintenance on our primary residence cannot be used towards rep status. He says certain things you could count towards reps would be pool maintenance, HVAC service, et cetera. I say no because it's a primary residence and reps is strictly for time you spend on rentals only. I'd like him to not have to sleep on the couch any longer." - No, personal residence maintenance doesn't count toward business hours.

Resources:

https://andersonadvisors.com/strategy-session

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/@ClintCoons

The Best Structure for Real Estate C Corp vs. LLC Explained

Wed, 03 Sep 2025 05:00:00 -0300

In this Tax Tuesday episode, Anderson Advisors’ Barley Bowler, CPA, and Eliot Thomas, Esq., tackle ten listener questions covering essential tax strategies for business owners and real estate investors. They break down the enhanced contribution limits for solo 401(k)s, including the new employer Roth contributions and age-based catch-up provisions. The attorneys explain proper loan structures between shareholders and corporations, emphasizing documentation requirements and interest rate compliance. They cover installment payment reporting for private money loans, clarify the Augusta Rule (280A) for tax-free rental income from home meetings, and distinguish between deductible business expenses versus personal costs. Investment structuring strategies for AI and energy stocks are explored, along with C-corporation real estate ownership considerations. The episode concludes with discussions on the expanded SALT deduction limits, pass-through entity tax workarounds for high-tax states, and the new research and development tax benefits under recent legislation.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"What is the maximum that can be contributed to a solo 401k Roth as the employee and employer of my own business, what do I need to do to handle payroll for myself?" - Employee limits: $23,500 (under 50), $31,000 (50-59), $34,750 (60-63). Employer: 25% of compensation. Use professional payroll services.
"I want to loan cash for my business to myself, since my spouse and I have regular W2 jobs that push our incomes into high, the highest tax brackets. Other than loaning money to myself to pay for rental property. Are there any other uses for those loan funds? What are the issues on the backend for repayment rights?" - Must have written documentation, regular payments, and applicable federal rate interest (4.22% for 2025).
"I'm receiving installment payments on a private money loan from my borrower. Are these payments listed as income, even though the entire principal balance and interest haven't been paid yet? How do you show this on a tax return?" - Interest portion is taxable income as received. Principal repayment is not taxable. Report on Schedule B.
"I have a C Corp and two LLCs. Can you clarify the tax allowance on Augusta meetings, please? Also known as 280A. I believe I was informed that I can deduct up to $1000 per month on these monthly meetings when held, is this still the case for 2024 and 2025?" - Fourteen days maximum per year regardless of entity count. Get three local quotes for reasonable rates.
"Are the paid fees for business essentials and the Living Trust deductible as startup costs or operating costs?" - Business essentials are deductible (startup vs operating depends on timing). Living trust is personal expense, not deductible.
“What strategies should I set to invest in AI or energy stocks?" - Wyoming LLC for passive investing. Trading partnership with C-corp for active trading and tax benefits.
"A C corporation owns a disregarded LLC, which in turn owns real estate. The real estate is sold for capital gains that is incurred by the C Corp. Is this the best way to be structured?" - Never put appreciable real estate in C-corp unless flipping. For buy-and-hold, use Wyoming holding company structure.
"Does the SALT (state and local tax) deduction of $40,000 apply to a joint tax return?" - Yes, $40,000 limit applies to joint returns. Phases out at $500,000 AGI but maintains $10,000 floor.
"How does the new PTET (pass through entity tax) SALT (state and local tax) deduction work around policy work for high tax states like California? Are certain entities included like SSTBs (specialized service trader businesses)?" - Pass-through entities can pay state tax for federal deduction. Complex structures and publicly traded partnerships excluded.
"How might the research and development (R&D) tax credit that's been affected by the big beautiful bill help me as a small business owner?" - Domestic R&D expenses can be deducted immediately (100%) or over five years. Foreign expenses still 15 years.

Resources:

https://andersonadvisors.com/ss/?utm_source=5-reasons-restructure-sole-proprietorships&utm_medium=podcast
Tax and Asset Protection Events

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/@ClintCoons

IRS Sections 168 & 179 Made Simple How to Boost Depreciation Deductions

Tue, 19 Aug 2025 05:00:00 -0300

In this Tax Tuesday episode, Anderson tax attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., tackle a diverse range of tax questions covering rental property strategies, depreciation rules, and business structure optimization. They explain the tax implications of renting property to family members below market rates, including income reporting requirements and limited deduction capabilities. The attorneys discuss gifting rental properties to children and the associated gift tax filing requirements, while exploring sophisticated property management company structures for generating earned income and maximizing retirement contributions. They provide detailed guidance on utilizing IRS sections 168 and 179 for depreciation and bonus depreciation, clarifying the current 100% bonus depreciation rules and debunking outdated 80% figures. Other topics include S-corp benefits for 1099 contractors, holistic health business taxation, accountable plan cell phone deductions backed by IRS Notice 2011-72, vehicle deduction methods and limitations, and even professional gambling expense deductions for Vegas visitors. Throughout the episode, they emphasize proper entity structuring, asset protection, and tax planning strategies.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"I have a question about tax implications of renting my property to my parents. If I rent it to them for less than fair market value, are there any tax incentives or exemptions in this situation? I'm trying to understand whether I would still need to report the income and if I would lose the ability to deduct expenses associated with the property." - Must report income; IRS treats below-market family rentals as not-for-profit activities.
"In 2024, I deeded some rental properties to my children about $250,000 each. Is there a way to write this off?" - No deduction available; must file Form 709 for gift tax reporting.
"I have four rental properties. I personally manage them through an LLC. Can I use my company as a management company and charge a 20% fee for managing it to be able to show I have earned income and then contribute to an IRA? Also, would I be able to establish a Roth IRA?" - Yes, with reasonable fees and proper structure; enables IRA contributions.
"How do I utilize IRS code section 168 and 179 for depreciation and bonus depreciation? How do I buy cars and furniture right off up to 80% of the value of the property every time I buy a house rental or asset? Can I utilize AI or any AI software with these to automate and hands off anything?" - Use 179 first, then 168 bonus depreciation; now 100% not 80%.
"I'm a 1099 independent contractor. I own two pieces of property, one is my primary residence, the other has a home and a small apartment on it that I rent out long term under the table. My thoughts are that I need to create an LLC for my business, possibly an S corp. As I understand the tax laws, there will be no way to use any of the rental properties to reduce the tax burden of my 1099 income. Am I on the right track here?" - Report all income; S-corp saves self-employment tax; passive losses don't offset.
"I'm going to start a consulting business that focuses on holistic health. What should I be looking for in the next six months or so when I launch? Is taxation different from real estate and in what way?" - Consider S-corp for self-employment tax savings; business expenses differ significantly.
"With an accountable plan, can I deduct a hundred percent of a cell phone? Is there some documentation that backs this up? Prove it." - Yes, 100% deductible with S/C-corp; IRS Notice 2011-72 provides documentation.
"I have a question about vehicle deductions. There are two methods available, the standard mileage deduction and the actual expense method. Can I use the actual method to claim all the depreciation in one year, then switch to the standard mileage deduction in subsequent years. If this is possible, how does it work? Assume the vehicle is used a hundred percent for business purposes." - Three methods exist; business-owned vehicles allow 100% bonus depreciation benefits.
"Since you're in Vegas, you might know the answer to this one. My friend won a reportable jackpot, mid five figures, and he was wondering if he could deduct the travel lodging expenses just as he might do if he made this money as a business deal or future excursions to Sin City to try and extend his winnings." - Only if professional gambler with business intent and meticulous records.

Resources:

https://andersonadvisors.com/ss/?utm_source=5-reasons-restructure-sole-proprietorships&utm_medium=podcast

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/@ClintCoons

Capital Losses Explained: When to Write Off a Losing Investment

Tue, 05 Aug 2025 05:01:00 -0300

Today on Tax Tuesday, Anderson Advisors Barley Bowler, CPA, and Eliot Thomas, Esq., focus on capital gains, cryptocurrency, stock trading structures, and real estate strategies. They explain how capital losses are deducted and the $3,000 annual limit that hasn't been adjusted for inflation since the 1950s. You’ll hear about Bitcoin's tax treatment as a personal asset with favorable capital gains rates but note the lack of wash sale rule protections. They demonstrate how a trading partnership with a C corporation can provide significant tax advantages through accountable plan reimbursements. The episode extensively covers real estate topics including the distinction between repairs and capital improvements, the inability to deduct lost rent from deadbeat tenants, and home office deductions for primary residences. They explain 1031 exchanges in detail and explore strategies for managing large capital gains from personal residence sales, including converting to rental properties and the Section 121 exclusion benefits.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"I have a large capital loss. How are capital losses deducted? When should I consider taking a tax write off by closing the position, unrealized versus realized gains?" - Capital losses offset gains first, then $3,000 annually against ordinary income.
"My wife and I are considering investing in Bitcoin. What are the tax advantages or disadvantages of doing so investing crypto for crypto for that type of investment?" - Bitcoin treated as capital asset with favorable rates, no wash sale rules.
"I do a lot of stock buying and selling. Is it tax efficient to set up a business entity?" - Trading partnerships with C corporations provide excellent accountable plan reimbursement opportunities.
"Can you explain what differentiates whether a real estate rental deduction would be categorized as a maintenance repair deduction versus a capital expense deduction? And provide examples. Please explain how these are treated differently from a tax perspective as well." - Repairs maintain property condition; capital improvements add value, extend life, or change use.
"Can I deduct lost rent from a deadbeat tenant?" - No deduction available; you simply don't report income you never received.
"I've heard you talk about renovations major to rental property and tax advantages, but what about for my primary residence? I need to finish the basement. Upgrade the house. This is also the address of my C corp business is registered to, and I operate a home office out of it. When I complete taxes next year, is there anything specific that I can take advantage of due to this large expense?" - Primary residence improvements add to basis; home office allows business-related deductions.
"Can I do a 1031 exchange on real property?" - Yes, but not on primary residences or inventory properties like flips.
"I bought a rental property in California in 2019 for 700,000 as replacement property from a 1031 exchange. 400,000 was from the sale of rental property in Seattle, Washington. 300,000 from my savings. I took a loan, also a 600,000 for expansion, uh, in repairs in January of 25. How much of the money I invested from my personal savings, the 300,000, can I get back without having to pay tax? I listed my rental property for 935,000." - Any cash taken from 1031 exchange creates taxable boot; consider real estate professional strategies.
"I'm selling my personal residence next year. We currently have an anticipated capital gain of a million. I'll be paying taxes on 500,000 of the capital gain above the capital gain exclusion for married filing joint. What tax strategy would you suggest that I may plan to use in order to mitigate paying federal taxes against the 500K capital gains? Could I do a 1031 exchange or of a personal residence? Can we convert the personal residence to a rental and then sell it in one to two years?" - Use Section 121 exclusion first, consider converting to rental within five-year window for 1031.

Resources:

T ax and Asset Protection Events

https://andersonadvisors.com/strategy-session

https://andersonadvisors.com/ss/?utm_source=5-reasons-restructure-sole-proprietorships&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

One Big Beautiful Bill Act Full Breakdown

Tue, 22 Jul 2025 05:01:00 -0300

In this special Tax Tuesday episode, Anderson attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., break down the major provisions of the "One Big Beautiful Bill" - nearly 1,000 pages of new tax legislation. They cover significant changes to child tax credits (increased to $2,200), expanded 529 plan qualifications now covering trade schools and licensing exams, and modifications to personal casualty loss deductions. The attorneys explain the updated salt (state and local tax) limitations increasing from $10,000 to $40,000, new charitable deduction rules for both itemizers and non-itemizers, and the elimination of clean energy tax credits after 2025. They also discuss the extension of lifetime estate and gift tax exemptions to $15 million, the return of 100% bonus depreciation for real estate investors, revamped opportunity zone investments starting in 2027, and enhanced qualified small business stock (1202) exclusions with reduced holding periods and increased limits. Tune in for expert analysis on these game-changing tax strategies!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

Child Tax Credit Changes - Increased to $2,200 with $1,700 refundable portion for qualifying children.
529 Plan Expansion - Now covers trade schools, licensing exams, and K-12 up to $20,000.
SALT Deduction Limits - Increased from $10,000 to $40,000 for state and local taxes.
Charitable Deduction Rules - Non-itemizers get $1,000 single/$2,000 married; itemizers face 0.5% floor starting 2026.
Clean Energy Tax Credits - Electric vehicle and solar credits eliminated after September 30, 2025.
100% Bonus Depreciation - Applies to property with 20-year or less lifespan; requires cost segregation study.
Opportunity Zone Investments - 10% stepped-up basis after 5 years; tax-free appreciation after 10 years.
1202 Stock Exclusions - Reduced holding periods: 50% at 3 years, 75% at 4 years, 100% at 5 years.

Resources:

https://andersonadvisors.com/strategy-session

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/@ClintCoons

This ‘Boring’ Real Estate Asset Is Crushing It in 2025?

Tue, 15 Jul 2025 05:01:00 -0300

In this episode, Toby Mathis, Esq., of Anderson Business Advisors, sits down with Ryan Gibson from Spartan Investment Group to discuss the current housing market and the unique opportunities in self-storage investing. They explore how the housing market has changed with low transaction volumes due to homeowners holding onto low-interest-rate mortgages, creating opportunities in alternative real estate sectors.

Ryan explains how self-storage offers advantages over traditional rental properties, including no evictions, automated operations, and steady cash flow. The discussion covers Spartan's approach to acquiring mom-and-pop storage facilities and professionalizing their operations, the different investment strategies in self-storage, and how millennials have become the largest demographic using storage facilities. With over 800 million dollars in assets under management and a track record of 16 successful exits, Ryan shares insights on market consolidation, value-add opportunities, and why self-storage has been the best-performing commercial real estate asset class.

Highlights/Topics:

(00:00) Intro
(00:58) Current Housing Market Update
(05:20) Self Storage Investing Benefits
(08:33) How to Consider Investing in Self-Storage
(12:39) Different Types of Strategies
(15:40) Big Opportunities
(19:23) Millennials are Using Self-Storage the Most
(21:33) Self Storage is a Great Asset
(22:44) Outro
Share this with business owners you know

Resources:

Learn more about Ryan Gibson and Spartan-Investors https://spartan-investors.com/

https://spartan-investors.com/

https://andersonadvisors.com/strategy-session/?utm_source=this-boring-real-estate-asset-is-crushing-it-in-2025&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=this-boring-real-estate-asset-is-crushing-it-in-2025&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

Toby Mathis TikTok

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Capital Gains Rules When You Sell a Home and Buy Another

Tue, 08 Jul 2025 05:00:00 -0300

In this Tax Tuesday episode, Barley Bowler, CPA, and Eliot Thomas, Esq., tackle a diverse range of tax questions covering business structures, real estate investments, and tax optimization strategies. They demonstrate significant tax savings by comparing Schedule C sole proprietorship versus S Corporation structures, showing how proper business formation can save approximately $6,000 annually on just $50,000 of income. The hosts address healthcare deductions for S Corporation owners, explain the complexities of the self-employed limited partner exception, and dive deep into capital gains calculations and 1031 exchanges. They also cover tax lien investments, charitable boat donations, and probate avoidance strategies. With practical examples and real calculations, this episode provides actionable advice for entrepreneurs and real estate investors looking to minimize their tax burden while staying compliant with IRS regulations.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"What is the best way to reduce my income and my self-employment taxes? I'm single, a handyman/contractor with no dependents. I work solo, no employees." - Form S Corporation, pay reasonable wage, save on employment taxes.
"I have an S-Corp LLC for my property management and business consulting activities. I'd like to provide my me and my spouse's healthcare through the LLC. What's the best way to go about this?" - S Corporation pays premiums, adds to W2, deducts on Schedule 1.
"Self-employed limited partner exception. Please talk about this topic." - Very risky strategy; IRS cracking down; use S-Corporation instead.
"How can one start a business, LLC or C-corp, and an ideal state of incorporation and hold those shares in a Roth IRA?" - Cannot own an operating business in Roth IRA; consider ROBS instead.
"What types of taxes and tax reporting will be involved if I begin investing in tax liens?" - Interest income or property ownership; depending on the redemption outcome.
"What are the rules for capital gains taxes on the sale of a house when the profits are used to pay cash on the next property?" - Sales price minus adjusted basis equals gain; cash use is irrelevant.
"I am taking my primary home and turning it into a rental for one to two years. How do taxes work if you wanted to 1031 a portion of the gains?" - Take Section 121 exclusion first, then 1031 the remaining gain.
"Under a 1031, taxpayers must select three possible real estate properties within 45 days. Can these selected properties be changed before the 180-day deadline?" - No changes allowed after 45 days; very strict timeline rules.
"I have a boat to donate to charity. Is it true that I can make a $5,000 donation without having a certified appraiser?" - Yes, under $5,000 needs written acknowledgment, not certified appraisal.
"What are the ways we can avoid probate?" - Living trust, joint ownership, beneficiary designations, lifetime gifting strategies

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=capital-gains-rules-when-you-sell-a-home-and-buy-another&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=capital-gains-rules-when-you-sell-a-home-and-buy-another&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Is Now a Good Time to Buy Rental Property?

Thu, 26 Jun 2025 05:01:00 -0300

In this episode, Anderson Business Advisors host Clint Coons, Esq., sits down with long-time client and real estate investor Tarl Yarber to discuss whether now is the right time to invest in real estate. Tarl, a "recovering house flipper" who has completed over 650 flips, shares his journey from wholesaling in 2005 to becoming a full-time investor focused on the BRRRR strategy (Buy, Rehab, Rent, Refinance, Repeat). They explore the current market disruption, why people should be buying when others are running away, the importance of understanding construction and value-add opportunities, and how to properly evaluate cap rates beyond surface numbers. As Tarl explains, "Will my future self thank me on this deal or not?" - a question every investor should ask themselves. Tarl also explains the power of 1031 exchanges for building wealth, including a detailed breakdown of reverse 1031 exchanges. The conversation covers market fundamentals, the benefits of forcing appreciation through construction, and why investing is about mitigating risk first, profit second. Tune in for expert insights on navigating today's real estate market with confidence!

Tarl Yarber is a "Recovering House Flipper" with over 650+ single-family residential properties purchased, rehabbed, and resold over the last 13 years. Tarl is considered an expert in the single-family residential investment industry and specializes in scalable, duplicable systems for real estate investing. In the last few years, Tarl has been fighting his addiction of Fix and Flip, and focusing on a new passion, BRRRR investing. As a recovering house flipper, Tarl has taken his years of experience in rehabbing houses and applied that experience in mastering the buy, rehab, rent, refinance, repeat investment model. In addition to his real estate success, Tarl has teamed up with Ken McElroy to create The Limitless Financial Freedom Expo, where they focus on real no BS education, as well as bringing some of the world's top financial minds to one event.

Highlights/Topics:

(00:00) - Intro
(01:35) - Tarl Yarber Introduction
(05:45) - Lesson Learned from Flipping
(07:09) - Limitless Expo
(17:32) - Is Now a Good Time to Buy Rentals?
(19:51) - Why People Should Buy Real Estate Now
(28:24) - Evaluate Cap Rates
(37:27) - Reverse 1031 Exchange Explained
(42:38) - Summary, closing comments, final words of advice

Resources:

Instagram: @tarlyarber

Limitless Expo (July 31- Aug 2 in Dallas) Site: go.LimitlessExpo.com
http://go.limitlessexpo.com/

https://andersonadvisors.com/strategy-session/?utm_source=is-now-a-good-time-to-buy-rental-property&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=is-now-a-good-time-to-buy-rental-property&utm_medium=podcast

https://andersonadvisors.com/

https://andersonadvisors.com/podcast/

https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w

https://andersonadvisors.com/ss/

1031 Exchange Rules When Buying in a Different State

Tue, 24 Jun 2025 05:01:00 -0300

In this comprehensive Tax Tuesday episode, Anderson attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., tackle complex tax strategies focusing heavily on 1031 exchanges and business deductions. They explain why fix-and-flip properties cannot use 1031 exchanges since they're considered inventory rather than investments, and suggest using C-corps or S-corps for tax savings instead. The attorneys dive deep into 1031 exchange mechanics, covering depreciation carryover basis, cost segregation complications, and state clawback rules in California, Oregon, Montana, and Massachusetts. In other topics, they discuss the heavy SUV deduction for vehicles over 6,000 pounds, explaining how to maximize depreciation through Section 179, bonus depreciation, and MACRS while requiring material participation. Other tips include strategic use of management C-corps for rental property mileage deductions through accountable plans, qualifying for 0% capital gains rates, handling Ponzi scheme losses through IRS safe harbor provisions, tax implications of timeshare deed-in-lieu transactions, and expatriation exit taxes for high-net-worth individuals renouncing US citizenship.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"I own an LLC that I use to purchase a single-family house to fix and flip. Can I use a 1031 exchange to save on taxes while I look for my next property?" - No, fix-and-flip properties are inventory, not qualifying investments.
"I have five years left of depreciation on rental property. I was looking into a 1031 exchange but didn't realize that the depreciation schedule remains. Can I do a 1031 to defer some capital gains but no longer depreciate and/or buy another property and get new depreciation schedule for that one?" - You get carryover basis plus new excess basis depreciation.
"What are some of the rules regarding a 1031 exchange when selling a rental home in one state, but purchasing the replacement property in another state?" - Allowed, but watch for clawback rules in four states.
"If I buy a car with a weight more than 6,000 pounds for my newly incorporated business and have not earned any income in the first year of business, can I use it to reduce taxes against my spouse's W2 income?" - Yes, through S-corp with material participation and 50% business use.
"I own a rental house and a management corporation, which is a C corp. How do I deduct mileage for my rental activity?" - Use accountable plan reimbursements from C-corp for tax-free money.
"How does one qualify for 0% capital gains?" - Single filers need taxable income of $48,350 or less.
"I invested in an ATM syndication. It was a Ponzi scheme and all investment was lost. The K-1s I received for previous years were fraudulent. How do I file my taxes for those years that I received a fraudulent K-1?" - Use IRS safe harbor provision for 75-95% ordinary loss deduction.
"What are the tax implications of doing a deed in lieu for a timeshare?" - Creates cancellation of debt income taxed at ordinary rates.
"What happens to your real estate if when you move outside of the country, is it deemed disposition?" - Only if expatriating citizenship, then exit tax applies.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=1031-exchange-rules-when-buying-in-a-different-state&utm_medium=podcast
Tax and Asset Protection Events

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=1031-exchange-rules-when-buying-in-a-different-state&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Why You Should Trade Stocks Through an LLC

Tue, 10 Jun 2025 05:01:00 -0300

In this Tax Tuesday episode, Anderson Business Advisors’ Barley Bowler and Eliot Thomas, Esq., tackle complex listener questions covering bonus depreciation regulations, short-term to long-term rental property transitions, and the intricate tax ordering rules for combining stock losses with real estate gains. They explore nonprofit structures for foster care services, explain 1031 exchange debt requirements for orthodontic practice sales, and provide guidance on entity selection between partnerships and S-corporations for different business types. You’ll hear how and when to handle Ponzi scheme theft loss deductions, corporate trading structures for stock income reduction, and the critical tax implications of providing company cars to family employees for personal use. Tune in for expert insights on these advanced tax strategies and planning considerations!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"Regarding section 168 bonus depreciation, it says to qualify for 100% the property must have been purchased after January 20th, 2025. Does that mean property purchased in 24 but not put into use till 2025 would not qualify?" –This is proposed legislation, not current law yet.
"What are the tax implications of shifting properties from short-term rental to long-term rental after leveraging cost segregation reports to accelerate depreciation to offset some W2 income?" – Cannot do both in same year; changes passive loss treatment.
"Can you use short-term stock loss carryover to offset real estate depreciation recapture and capital gains?" – Yes, but only after specific tax code ordering rules.
"In the state of Florida, could parent fostering be conducted as a nonprofit business entity?" – Cannot earmark nonprofit funds for specific individuals or children.
"My husband's selling his orthodontic practice using a 1031 option. Can he pay off the existing loan before reinvesting the profit?" – Yes, QI will pay off debt; need equal/greater replacement debt.
"My S corporation business doesn't have cash flow to reimburse me for all benefits. Can I add unpaid reimbursements to my balance sheet like an owner loan?" – Need specific analysis of cash flow and reimbursement timing.
"My wife and I have a holding company LLC and multiple subsidiary LLCs currently taxed as partnerships. Should they be changed to S-corp?" – Real estate stays partnership; operating businesses - consider S-corp election.
"In a Ponzi scheme, does the discovery year have to be the year charges are filed?" – Discovery year when you become aware through government notification.
"Would establishing an LLC help me reduce tax on income from stock trading?" – Consider corporate trading partner structure for meaningful capital gains.
"Our C corp employs our son part-time. What are the tax implications of buying him a car for personal use only?" – Buy in his name, increase salary; avoid corporate ownership.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=why-you-should-trade-stocks-through-an-llc&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=why-you-should-trade-stocks-through-an-llc&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How to Legally Pay Your Kids Through Your Business

Wed, 28 May 2025 05:00:00 -0300

In this Tax Tuesday episode, Anderson attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., explore the limitations of renting home office space to yourself as a sole proprietor and explain superior alternatives through S and C corporations that unlock better deductions and reimbursement opportunities. The attorneys provide detailed guidance on properly paying children through family businesses to maximize tax benefits while avoiding employment taxes, and discuss the complexities of transferring real estate to children through gift strategies. They dive deep into syndication investments, explaining passive income treatment, cost segregation benefits, and how real estate professional status can transform passive losses into active deductions. Other key topics include the master lease strategy for short-term rental owners seeking to optimize tax benefits, the mechanics and restrictions of 1031 exchanges, medical expense reimbursements through C corporations (including controversial deductions for specialty foods and safety equipment), and the proper setup timeline for nonprofit organizations. Tune in for expert insights on these advanced tax strategies and more!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"Can I rent my home office to myself as a sole proprietor?" - No, use home office deduction instead.
"I know an owner of a small business can pay their kids to work for their company. I've heard several different facts about how exactly to do that, which contradict one another. Can you please explain the proper steps?" - Pay kids W-2 from sole prop, avoid taxes.
"We were advised to transfer real estate to our children up to a certain limit using the parent-child transfer provision form 709. Can you please discuss the advantages and disadvantages? Any limitations on the amount of equity transfer and any IRS requirements, etc.?" - Not recommended, complex bookkeeping, lose stepped-up basis.
"I want to join a syndication as a limited partner. What tax implications do I face at the time of distribution of profits and how does it change if they do a cost segregation and bonus depreciation while I'm still part of this syndication? An additional fact is that this person has their own long-term rental." - Passive income, and cost segregation create offsetting losses.
"Are you entitled to cost segregation benefits if you invest in a syndication with your IRA/401k funds?" - Yes allocated, but no tax benefit in retirement.
"Please explain the C Corporation Master Lease strategy for short-term rental owners. I own a short-term rental but was unable to capitalize on the short-term rental loophole because I had used professional property management. Does this strategy provide any advantage to somebody in my situation or allow me to take advantage of the loophole in a different way? How would the tax breakdown work in this case if I created a management C corporation?" - C corp manages property, shifts income, enables reimbursements.
"What is the downside of using a 1031 exchange to avoid taxes in a profit transaction? Are there any benefits?" - Strict deadlines, higher debt required, but defers taxes.
"What are the medical expenses aside from doctor visits and out-of-pocket medications allowed as reimbursable from the C corp? A doctor has recommended including antioxidant foods in our diet to improve my spouse's diet due to a specific condition. Is it reimbursable if we buy foods that are not really on our regular grocery list? Only because our doctor suggested it. Additionally, the other day, my spouse slipped on one of the floor mats, so I had to buy rug grippers. Is this also reimbursable?" - Doctor's note rule applies, antioxidants questionable, grippers no.
"I would like to know if I can start a business as a nonprofit before I begin doing the work. Or do I have to already be up and running?" - Set up a nonprofit entity first for protection.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=how-to-legally-pay-your-kids-through-your-business&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-legally-pay-your-kids-through-your-business&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Can You Boost Depreciation After a 1031 Exchange?

Tue, 13 May 2025 05:01:00 -0300

In this episode of Tax Tuesday, Eliot Thomas, Esq. is joined by Anderson CPA Barley Bowler. They explain how transfer-on-death titles still provide beneficiaries with stepped-up basis advantages and clarify that short-term rentals don't qualify for real estate professional status. You’ll hear proper entity structures for rental properties, recommending against holding appreciating real estate in C corporations. They thoroughly explain the 280A "Augusta Rule" that allows tax-free rental income from personal residences to your business for up to 14 days annually. With input from bookkeeping expert Troy Butler, they recommend QuickBooks Online for tracking rental property finances. Additionally, they cover Roth IRA conversions, tax withholding strategies, and 1031 exchange rules for deferring capital gains.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"When a house is under a transfer on death title, does the beneficiary still get a step-up in basis?" - Yes, they still get a stepped-up basis.
"If I already qualify as a real estate professional rep status via short-term rentals and add long-term rentals to the mix. Can I lump the two kinds together? And does having an S corporation that manages everything affect my rep status?" - Short-term rentals don't qualify for REP status. S-corps generally don't affect REP status.
"Where real estate properties are in individual LLCs, disregarded and owned by my C corporation, does the C corporation maintain one bank account and collect rent for all individual properties?" - Not recommended. Use a management company instead.
"If you get started in wholesaling, should you file as an S corporation?" - Yes, use S or C corp.
"What kind of bookkeeping is needed for rental real estate? Do you have any bookkeeping software to suggest?" - QuickBooks Online is recommended. Track properties separately.
"When doing an IRA to Roth conversion, are there any limits? Are pre-tax conversions always treated as ordinary income? Is it true that the IRS does not know or care when the conversions were done during the year?" - No limits. Yes, ordinary income. IRS treats as earned throughout year.
"How does tax work if a business owner is paying himself as an employee, do we have to tax twice? Once for the business income and once as an employee?" - No, payroll is deductible business expense.
"How do I do a 1031 exchange? And how do I maximize real estate property depreciation after I do a 1031 exchange? Am I stuck with the previous depreciation rate and amount of the previous property?" - Use a qualified intermediary. Trade up for more depreciation.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=can-you-boost-depreciation-after-a-1031-exchange&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=can-you-boost-depreciation-after-a-1031-exchange&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.instagram.com/realwealth/

https://www.youtube.com/@ClintCoons

The Top Rental Markets to Invest in Now

Thu, 01 May 2025 20:26:00 -0300

Clint Coons, Esq., interviews Kathy Fettke, founder of Real Wealth Network and a seasoned real estate expert with over 20 years of experience. They discuss current market conditions, with Kathy explaining how real estate's slow-moving nature provides stability compared to the volatile stock market. She shares that recent decreases in mortgage rates have already increased pending sales and mortgage applications. Kathy reveals her top investment markets, emphasizing the Southeast (particularly Texas and Florida) for growth and appreciation, while the Midwest (parts of Ohio and Indianapolis) offers better cash flow. She explains the importance of property type selection, market dynamics, and long-term strategy, highlighting how newer properties in growth markets typically outperform older properties in stagnant markets, even if the latter initially show better cash flow. Kathy also discusses the current opportunity with builders offering rate buy-downs on new construction, property management considerations, and the importance of avoiding markets with unfavorable landlord laws. This episode provides valuable insights for both new and experienced real estate investors looking to build wealth through strategic property acquisition.

Kathy Fettke is Co-Founder of RealWealth.com, helping busy professionals acquire turnkey rental properties in fast-growing U.S. markets. She also leads RealWealthDevelopments.com, offering passive build-to-rent syndication opportunities. Kathy hosts The Real Wealth Show and Real Estate News for Investors podcasts, and co-hosts BiggerPockets: On the Market. She authored the bestsellers Retire Rich with Rentals and Scaling Smart with her husband, Rich Fettke. A frequent speaker and media guest, Kathy has appeared on CNN, CNBC, Fox News, NPR, and CBS MarketWatch.

Highlights/Topics:

Current real estate market conditions and mortgage rate sensitivity
Top investment markets: Southeast for growth vs. Midwest for cash flow
Importance of property condition in investment returns (newer vs. older properties)
The danger of focusing solely on cash flow without considering long-term appreciation
Current opportunity with builders offering interest rate buy-downs
Millennial demographic demand driving rental housing needs
The importance of proper property management selection
Avoiding markets with unfavorable landlord-tenant laws
Long-term vs. short-term real estate investment strategies
Closing comments, final words of advice

Resources:

Real Wealth

Real Wealth Developments

https://realwealth.com/real-estate-syndications/

https://www.instagram.com/kathyfettke/

https://aba.link/RWN42025SS

https://aba.link/RWN42025TAP

https://andersonadvisors.com/

https://andersonadvisors.com/podcast/

https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w

How to Sell Stocks Tax-Efficiently to Buy Rental Property

Tue, 29 Apr 2025 12:01:00 -0300

In this episode, Anderson attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., address several listener questions on a variety of tax topics. They cover the tax implications of selling stocks to purchase rental properties, explaining capital gains strategies and depreciation options. The duo discusses using LLCs and management corporations for rental properties, including how property management fees can generate tax-free income. They explore inheritance tax considerations for 401(k)s, the benefits of short-term rentals for generating tax losses, and the implications of moving back into a rental property. Other topics include setting reasonable salaries for S-Corporation owners, maximizing depreciation to offset W2 income, claiming natural disaster losses, depreciating remodel costs for rental properties, and properly implementing the 280A/Augusta Rule for tax-free home rentals.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"I would like to sell my stocks and use the money to help purchase a rental property. Is there a strategy to minimize or avoid paying taxes on capital gains or any other tax-saving advice?" - Loss harvesting and short-term rental tax benefits.
"Would a rental property not in an LLC also be reported under the Management Corporation or a 1040?" - Report rental on 1040, management fee on 1120.
"What would the tax implication be when a spouse passes and the surviving spouse inherits a 401k?" - Lump sum, continue distributions, or rollover options.
"What would be the tax consequences concerning W2 income, depreciation, etc., of purchasing a rental property, using it as a short-term rental with material participation in the tax year that it was purchased, then selling it the following tax year?" - First-year losses, later depreciation recapture on sale.
"What are the tax implications if I've moved back into my rental and use it as my primary residence? I'm not planning on selling anytime soon." - Reduced Section 121 exclusion, depreciation recapture later.
"What is a reasonable salary range we should set for ourselves to remain compliant but still maximize our S Corporation Tax savings?" - 30-60% of net business income typically.
"If a person is a W2 wage earner and wants to start real estate as a side job, what needs to be true when picking real estate options to maximize asset depreciation to help offset my W2 taxes owed?" - Short-term rentals with material participation (100+ hours).
"If I experienced a loss from a flood that was declared a natural disaster in 2024, how do I take that credit on my taxes?" - Personal: federal declaration required. Business: none needed.
"How do you depreciate remodel costs for an income property? So, a rental property. You purchased the property, for example, 10 years ago for 100k, and began depreciating it. This year, you put 30K into a remodel that included floors, paint, kitchen cabinets, and appliances." - Separate depreciation schedules for each improvement type.
"I'm interested in using the 280A/Augusta rule rental of my home for an upcoming seminar that I'll be attending online. Am I allowed to use this strategy since I'm the only one attending? Also, I reviewed the document that Anderson put together for the 280A. It mentions getting three quotes. If I call a hotel and ask for a conference room quote for one person, I imagine I won't be taken seriously. Do you just request a small conference room for five people or less?" - One-person meetings allowed; request quotes for small groups.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=how-to-sell-stocks-tax-efficiently-to-buy-rental-property&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-sell-stocks-tax-efficiently-to-buy-rental-property&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://riskcoverage.com/

https://www.youtube.com/@ClintCoons

How to Stop Employee Theft & Embezzlement in Your Business

Thu, 17 Apr 2025 05:00:00 -0300

In this episode, Toby Mathis, Esq., of Anderson Business Advisors, welcomes David Pelligrinelli, a professional asset recovery expert from ActiveIntel. They dive deep into the alarming reality of employee theft and embezzlement in businesses of all sizes. David explains the "fraud triangle" concept—opportunity, pressure, and justification—that enables employee theft, sharing real-world examples of trusted employees who stole hundreds of thousands of dollars from their employers. They discuss essential prevention strategies like having owners open all financial mail, requiring employees to take vacations so others can review their work, and implementing proper checks and balances. The conversation reveals sophisticated theft techniques, including ghost vendor schemes and credit card fraud, while emphasizing that even trusted employees can succumb to temptation when proper controls aren't in place. David also shares fascinating stories about asset recovery investigations and explains how counter-investigation tactics can help those being investigated unfairly.

Highlights/Topics:

Introduction to employee theft and embezzlement as a common business problem
The "fraud triangle" concept: opportunity, pressure, and justification
Best practices for preventing employee theft (opening mail, mandatory vacations)
Ghost vendor schemes and sophisticated theft techniques
Long-term financial impact of embezzlement on business profitability
Examples of elaborate asset concealment by debtors
Employee dishonesty insurance coverage options
Counter-investigation tactics and illegal investigation methods
Share this with business owners you know

Resources:

Email: dave@activeintel.com

https://actualhuman.com/

https://telemediator.com/

https://www.activeintel.com/

The Best Entity for Real Estate Syndications and Maximum Tax Benefits

Tue, 15 Apr 2025 05:00:00 -0300

Tax season is in full swing, and in this Tax Tuesday episode, Anderson Advisors attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., tackle numerous listener tax questions with practical advice. They discuss the Section 121 exclusion for primary residences, explaining how married couples filing separately can each qualify for the $250,000 capital gains exclusion. They outline strategies for converting personal residences to rental properties using S-corporations and installment sales to maximize tax benefits. Amanda and Eliot clarify 401(k) withdrawal rules, explaining when penalties apply and options like the Rule of 55 and hardship withdrawals. You’ll hear recommendations on optimal entity structures for real estate syndications, explanations of the short-term rental "loophole" for active income classification, and when to use trading partnerships versus simple LLCs for investment accounts. The episode concludes with a breakdown of key Tax Cuts and Jobs Act provisions set to expire in 2025, including individual tax brackets, standard deduction changes, child tax credits, and bonus depreciation, highlighting potential impacts for taxpayers.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"I understand that you can sell your primary residence and receive an exclusion from capital gains taxes on the first $250,000 if you're single and $500,000 if you're married filing jointly. However, I can't find any rules regarding if you're married filing separately. Could you please confirm if married filing separate also qualifies for the exclusion? Also, could you talk about how making improvements adds to the basis?" - Yes, both spouses filing separately can each get the $250,000 exclusion. Only one spouse needs to be on the title, but both must use it as a primary residence for 2 of the last 5 years. Improvements (new floors, additions, HVAC systems) add to your basis, which reduces taxable gain when you sell.
"Can I use both cost segregation and bonus depreciation from an S-corp you sell your personal residence to for the Section 121 exemption? Also, what is the accounting treatment if you sold your personal residence to an S-corp using an installment sale?" - Yes to cost seg, no to bonus depreciation (not allowed for related-party transactions). For accounting, record the property as an asset on the S-corp with a liability for the note owed to you personally. You'll recognize all gain in year of sale (which is actually beneficial to utilize the Section 121 exclusion), and interest payments will be recorded as interest income.
"Do I have to officially quit my job and be retired to take disbursements from my 401k? At what age can I take disbursements from my 401k? Are there any negative tax implications from taking early disbursements?" - You don't need to quit your job to take distributions if you're 59½ or older, though your specific plan may have different rules. Early withdrawals before 59½ incur a 10% penalty plus ordinary income tax, unless you qualify for exceptions like the Rule of 55 (if you leave your job at 55+) or hardship withdrawals for specific situations.
"What is the best entity for tax purposes to invest in real estate syndications?" - A Wyoming LLC (disregarded) or partnership is typically best. This gives liability protection while letting income/losses flow directly to your personal return (important for using passive losses). Avoid S-Corps (reasonable wage requirements) and C-Corps (trap gains/losses on corporate return).
"Regarding bonus depreciation and the short-term rental loophole, are either the 500 hours or 100 hours and, more than anyone else, material participation tests prorated for the year? For example, if a property is purchased and put into service in November, those hours would be difficult to achieve." - No, these hours are not prorated. You must meet the full hour requirements between purchase and December 31st. Consider using the "substantially all participation" test if you personally perform nearly all work needed, even if under 100 hours.
"If I purchased an investment apartment and repaired windows, floors and incurred other miscellaneous expenses to make it ready for renters, can I write the expense off on my Schedule E? I didn't receive any income for that apartment as of yet." - You can only deduct expenses after the property is "placed in service" (available for rent). If not in service yet, these costs must be added to the property's basis and depreciated. The $2,500 de minimis rule lets you expense (not capitalize) individual purchases under $2,500, but only after the property is in service.
"I'm starting to do wholesale investments. I'm still a W-2 employee, yet I will resign soon. Is it recommended that I start my LLC now, and why?" - Yes, start your LLC now for liability protection when entering contracts. Begin with a disregarded LLC in the state where you're wholesaling. Once established and generating consistent income, consider making an S-Corporation election to save on self-employment taxes.
"I have a trading account, but I do not actively trade in it. Should I set up a trading partnership for it?" - If you're not actively trading, a simple Wyoming LLC for asset protection is sufficient. For active traders with significant expenses, consider the limited partnership structure with a C-Corporation general partner to shift some income and deduct expenses that aren't allowed on personal returns.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=the-best-entity-for-real-estate-syndications-and-maximum-tax-benefits&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=the-best-entity-for-real-estate-syndications-and-maximum-tax-benefits&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Inherited IRAs Can You Convert to a Roth Tax-Free

Tue, 18 Mar 2025 05:00:00 -0300

Today, Anderson Advisors attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., discuss topics including navigating inherited IRAs and potential Roth conversions to understanding crucial deadlines for spousal and non-spousal inheritances. The questions explore filing for trading LLCs with expenses but no income, leveraging C-Corps for medical cost reimbursements, and addressing real estate tax considerations including depreciation recapture. Key insights include combining 1031 exchanges with 121 exclusions when converting investment properties to primary residences, maximizing education and travel deductions in real estate transactions, and utilizing strategic business entities, defined benefit plans, and 401(k)s to shelter active income.

Send your tax questions to taxtuesday@andersonadvisors.com.

Highlights/Topics:

“Can you roll an inherited IRA into a Roth IRA before the 10 year liquidation time limit is over? If so, will it be a taxable event?” - Typically no, especially for non-spousal inherited IRAs.
“I took 2024 off, had no W-2 income, and did no trading.” “However, I had some trading expenses, monthly subscriptions. Do I need to file an individual 1040 return and/or Form 1065 for my trading LLC, even though I had no W-2 income and did no trading?” - Yes, file to account for trading expenses.
“I am in the process of creating a trading partnership with the C-Corp. Due to an accident 20 years ago, I have high medical expenses and want to use the C-Corp to reimburse my out-of-pocket medical expenses. I have caregivers who work three hours per day. Can I reimburse myself for the salary? I pay them through the C-Corp. What other medical expenses can I reimburse?” - Yes, using Section 105 plan for reimbursements.
“I have short-term rental property managed by a management company. Before the end of the year, I’m taking over management duties. Does the passive income switch to active or does the passive income stay passive?” - No, managing yourself doesn’t change income to active.
“When selling a rental property, do you have to pay 25% depreciation recapture tax on things that have been depreciated down to zero and have been gone or deleted for over a year?” - Yes, recapture applies to fully depreciated assets.
“Can I apply both 1031 like-kind exchange and 121 exclusion to an investment property? Yes, with strategic planning for property transitions.
“Can I sell my investment home, apply 1031, and make the replacement home my primary residence?”
“When selling my primary residence, do seller concession expenses help stay within the $250,000 capital gain exclusion? Example, help buyer with closing costs, any repairs, et cetera. I have spent over $3000.” - No, concessions don’t impact the exclusion directly.
“I have spent over $3000 on different online real estate education programs. Can I deduct these as business expenses, or are only education expenses that are not online deductible?” - They are deductible only if related to continuing existing business education.
“I attend a lot of investor’s meetings in person, travel with my personal not business automobile. How can I deduct these costs as business expenses,” - Track mileage and use accountable plans for deductions.
“How do I save on taxes when wholesaling properties?” - Use business entities and retirement plans strategically.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=inherited-iras-can-you-convert-to-a-roth-tax-free&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=inherited-iras-can-you-convert-to-a-roth-tax-free&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How to Use 401(k) Funds to Start a Nonprofit (Avoiding 10% Penalty)

Tue, 04 Mar 2025 05:00:00 -0400

Today, Anderson Advisors attorneys Barley Bowler, CPA, and Eliot Thomas, Esq. discuss topics including how 401(k) funds can be borrowed up to $50,000 without tax penalties while confirming that backdoor Roth IRA contributions made in 2024 but converted in 2025 still allow for additional 2025 contributions. Eliot and Barley discuss why S-corporations cannot deduct wellness expenses through accountable plans unless medically prescribed, and confirm the 20% Qualified Business Income deduction applies across multiple businesses. For entity structures, they recommended against holding appreciating real estate in corporations, favoring disregarded LLCs for asset protection. Regarding trading partnerships with C-corporations, these need written contracts for guaranteed payments, and confirmed short-term rental owners can switch to self-management to claim material participation benefits and accelerated depreciation through cost segregation.

Send your tax questions to taxtuesday@andersonadvisors.com.

Highlights/Topics:

"Are there ways to withdraw funds from a 401(k), a retirement account, without moving it into an IRA?" a sponsored plan versus an individual plan? "We're also starting a nonprofit business. And how can we avoid that 10% early withdrawal penalty?" - Take a loan from your 401(k) for up to $50,000 without tax/penalty.
"I attempted to do a backdoor Roth IRA conversion. On December 24th, I did it at the end of the year. I'm a high-income earner, was not aware of the financial institution, and had made a temporary change. There was some hold time for the funds. We made a deposit contribution at the end of the year. The question here is, the $7000 post-tax contributed to the traditional IRA in December was not available to convert? We went over the past the end of the year to the 2025 tax year, and we're wondering how that's treated since the conversion was completed in 2025, but the contributed contribution occurred in 2024. Is another $7000 contribution allowed?" - Yes, you can make another $7000 contribution in 2025 for another conversion.
"Can we use this to reimburse for gym membership, supplements, wellness plans, stuff like that?" - No, wellness plans aren't tax-deductible unless medically prescribed.
"My S-corporation provides financial services." Another question. We're talking about the qualified business income deduction, that 199A. That's a pretty good deduction, 20%. Good chunk of deduction. "Can we take that if we have two different businesses? How does that work? What's that look like?" - Yes, you can take the 199A deduction for both businesses simultaneously.
"I have two LLCs holding trading accounts, so a couple of different LLCs." We're going to talk about our trade structure a little bit differently. We also have just what we call a safe asset holding straight. If we have a brokerage account, high-value collectibles, or something like that. "Does putting a rental property into a disregarded LLC have any tax benefits?" "Can I transfer the interest of a disregarded to a holding company or to a living trust?" - Yes, with in-kind transfers; check with a broker; generally no tax consequences.
"I have a trading partnership." "Do I need a contract?" We're talking about guaranteed payments here, a very unique payment to a partner. - Yes, need a written contract detailing services between a partnership and C-corp.
"What are the pros and cons of holding real estate investments in a disregarded LLC, C-corp versus S-corp?"- Avoid S/C-corps for appreciating property; use disregarded LLCs with management entity.
"We're buying our first short-term rental this year. Considering using a third-party property manager, can I manage the property next year with material participation?" - Yes, you can manage it yourself in year two and claim cost segregation benefits.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=how-to-use-401k-funds-to-start-a-nonprofit&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-use-401k-funds-to-start-a-nonprofit&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Predicting 2025 Real Estate Trends

Tue, 25 Feb 2025 05:00:00 -0400

Real estate visionary Neal Bawa, CEO of Grocapitus and MultifamilyU, returns to the podcast. Neal always presents a compelling data-driven forecast that should capture every investor's attention. Despite current market uncertainties, Bawa reveals a significant 5-million-unit housing shortage alongside plummeting inflation rates, positioning the US as the strongest performer among developed economies. Most notably, he predicts a dramatic surge in both single and multi-family rent growth during 2026-27, driven by high interest rates creating supply gaps. With homeownership projected to decrease to 60% within a decade, the rental market is poised for unprecedented strength. This perfect storm of undersupply, shifting demographics, and economic conditions suggests a golden opportunity for strategic real estate investors, particularly in the multi-family sector, with promising rent growth anticipated as early as late 2025.

Highlights/Topics:

Hard data trumps market fear: why the numbers tell a different story
US economy dominates globally as inflation drops from 6% to 2.4%
Rising national wealth meets housing crisis: housing investment opportunity
New construction wave promises better prices for entry-level housing market
Five million unit shortage creates perfect storm for 2026-27 housing gap
Massive rent increases predicted across all housing sectors in 2026-27
Historic shift: Homeownership dropping to 60%, rental demand soars nationwide
Real estate investments outperform during global inflationary cycles and market shifts
2025 forecast: Interest rates and delinquencies reshape investment landscape ahead
Strategic opportunity: Significant rent growth predicted for late 2025 market
Visit multifamilyu.com to dive deeper into these insights!

Resources:

MultiFamily Website

https://multifamilyu.com/

https://andersonadvisors.com/strategy-session/?utm_source=predicting-2025-real-estate-trends&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=predicting-2025-real-estate-trends&utm_medium=podcast

https://andersonadvisors.com/

Bonus Depreciation in 2025: Still Available? Plus, How It Compares to Cost Segregation

Tue, 18 Feb 2025 05:00:00 -0400

We have now hit 237 episodes of Tax Tuesday! Today, Anderson Advisors attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., discuss topics including depreciation strategies, with detailed explanations of how bonus depreciation differs from cost segregation analysis. The conversation also covers real estate professional status requirements, home office deductions, and the strategic use of management C-corporations to maximize tax benefits. Other key topics included the limitations of 1031 exchanges for partnership interests, tax strategies for international property purchases, meal expense deductions under current tax law, and the benefits of a stepped-up basis for inherited properties. You’ll hear practical strategies for leveraging existing properties rather than selling them and included insights on how to minimize tax exposure through various investment structures and borrowing strategies.

Send your tax questions to taxtuesday@andersonadvisors.com.

Highlights/Topics:

In 2024, I spent most of my time managing rental properties under our LLC (not in a C or S management corp). I will claim real estate professional status for 2024 tax returns. What home office expenses can I deduct from rental income? Should we consider creating a management C corporation to maximize deductions? - You can deduct a portion of home expenses (mortgage interest, property taxes, utilities, etc.) based on either square footage or number of rooms method.
Is 100% bonus depreciation available in 2025? Is this the same as cost seg? - Cost segregation breaks down property components into different depreciation schedules (5, 10, 15 years) while bonus depreciation allows immediate write-offs of qualifying components.
If you meet 750 hours as a real estate investor and own both commercial/non-residential real estate property and residential rental property, could you use Schedule C or Schedule E on your tax return? - Generally, long-term rentals go on Schedule E regardless of real estate professional status. Schedule C might be used for short-term rentals (average stay less than 7 days) with significant personal services provided.
Does selling a partnership interest in a hotel business qualify for a 1031 exchange? How can you save on taxes on capital gain when you sell your partnership interest? - A partnership interest generally doesn't qualify for 1031 exchange (though the partnership itself could exchange the building).
If I inherit a property and now use the property as Airbnb, do I need to depreciate the value of the property? - You should depreciate the property because the IRS will assume you took depreciation when you sell and tax you accordingly (recapture). You'll get a stepped-up basis at inheritance value to depreciate from.
Can you comment on food and meals? When can those be expensed and how much? - Business meals are generally 50% deductible. Company-wide events like holiday parties or open houses with unrestricted attendance can be 100% deductible. Entertainment expenses are no longer deductible.
I'm a full-time employee receiving W2 income and own two rental properties which I manage myself. Can I use the qualified business deduction (QBI)? - Yes, you can potentially qualify for the QBI deduction. The safe harbor rule requires 250 hours of rental services, but you may still qualify even without meeting this specific threshold if you can prove it's a trade or business.
How can I avoid capital gains if I sell my rental home in the U.S. to purchase a multi-family home in Costa Rica? - Options include: living in the property for 2 of the last 5 years to qualify for primary residence exclusion, leveraging the U.S. property instead of selling, harvesting capital losses to offset gains, or investing in tax-advantaged opportunities to create offsetting losses.
I have two rental properties in SoCal owned since 2009 using straight-line depreciation. If I 1031 exchange these properties into replacement properties of slightly higher value, can I start depreciation over and do it correctly? If I 1031 these properties into replacement properties of slightly higher value, does that mean I can start depreciation all over and do it correctly? Getting more tax benefit. How does this affect my basis? What about any recapture when I then sell later? - In a 1031 exchange, you'll have carryover basis from the relinquished property. The basis in the new property will be its purchase price minus deferred gain. Instead of selling, consider leveraging existing properties to buy additional real estate for more depreciation opportunities.
What are the benefits of the step-up basis evaluation for a person's residence and investment property? - When inherited, properties receive a stepped-up basis to fair market value at death, allowing heirs to depreciate from the higher amount and potentially eliminate capital gains tax on appreciation that occurred during the deceased's lifetime.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=bonus-depreciation-in-2025&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=bonus-depreciation-in-2025&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

The #1 Real Estate Strategy for 2025

Thu, 06 Feb 2025 05:00:00 -0400

In this episode, Toby Mathis, Esq., of Anderson Business Advisors, chats with Atticus LeBlanc, CEO of PadSplit. Toby and Atticus discuss the innovative approach PadSplit is taking to address homelessness and provide affordable housing. They dive into troubling statistics about homelessness in 2024 and how rising home prices and interest rates are impacting the housing market. PadSplit’s model—offering multi-room rentals—provides a solution for both underserved communities and real estate investors, creating a two-sided marketplace. The conversation covers the operational benefits for landlords, the low turnover rates, and the impact PadSplit has on helping residents transition out of homelessness. Learn how this model offers affordable housing in 24-48 hours for under $300, while benefiting investors by reducing costs and increasing revenue. It’s a win-win for both society and your investment portfolio!

Highlights/Topics:

Toby’s PadSplit experience, frightening stats on homelessness for 2024
Increasing home prices, interest rates are not helping single-family residences
PadSplit rooms are a great solution for the underserved, and for investors
Reducing barriers to entry for the unhoused, revenue increases for landlords
How PadSplit operates as a two-sided marketplace
Different scenarios using PadSplit for multi-room home rentals
Standard costs for a “turn” as a landlord, saving with PadSplit
Early intervention for issues is easier with a PadSplit scenario
Residents have thousands of options if they don’t care for the room
What are the eviction rates with PadSplit?
What percentage of residents move from unhoused situations? This is the “invisible working population’ - not people on the street with a cardboard sign.
Residents can get a room within 24-48 hours, for under $300
So something good for society, and something good for yourself
Share this with investors you know

Resources:

Atticus LeBlanc LinkedIn

https://www.linkedin.com/in/atticus-leblanc-3960466/

PadSplit

https://www.padsplit.com/

https://andersonadvisors.com/strategy-session/?utm_source=1-real-estate-strategy-for-2025&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=1-real-estate-strategy-for-2025&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How to Move a Rental Property to a Trust & S-Corp for Asset Protection

Tue, 04 Feb 2025 05:00:00 -0400

Welcome to Tax Tuesday. Anderson Advisors attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., tackle various tax-related questions. Topics include retroactively claiming real estate deductions and depreciation, handling health insurance premiums for an S-corp, understanding the rules around setting up a trading account under an S-corp, and how to qualify for Real Estate Professional (REP) status while working a W2 job. The attorneys also discuss deadlines for S-election, converting properties for tax purposes, alternative methods for substantiating business expenses, and more. Tune in for valuable insights on managing your tax strategies effectively.

Send your tax questions to taxtuesday@andersonadvisors.com.

Highlights/Topics:

"I need to retroactively claim my real estate deduction or depreciation for my 2022 and 2023 taxes. I actively manage my own rental and have over 700-plus hours per year for real estate management. How do I claim accelerated depreciation for the past years?" - Yes, you can go back and retroactively capture previous depreciation, including accelerated depreciation or bonus depreciation, you do it n the current year. It's a form called 3115.
"I didn't have my health premiums added to my payroll statements for 2024. I have an S-corp and pay myself and another employee but wanted to deduct health insurance payments. Is there anything I can do at this point? Regarding asset protection, we have a rental property. We'd like to move this to a trust and then to an S-corp. Would that work?" - If the S-Corp it paying the premiums, on our 1040, we can make an adjustment on Schedule 1 for the insurance premiums because we're considered sole proprietor.
"I have seen some of your videos and had a question about setting up a trading account under an S-corporation. Is this correct? Can I pay my wife $15,000 from it and then match that amount toward a 401(k)? "My wife is a homemaker with low income. If we file just married filing jointly, are there any implications with this move? We are not traders but more investors."- Typically no, we would put it into an S-Corp.
"My employer recently went through a restructuring. They offered me one year's pay as severance. My last paycheck will be January, 2026. I feel confident that I'll be able to fulfill the REP status requirement for time spent on material real estate management activities in 2025. I will not make more money from my real estate investments as compared to my severance pay. Can I still qualify for the REP status? I used my solo 401(k) to invest in a real estate deal as a passive investor. The bank recently foreclosed the deal. It was a total loss. Is there any deduction that I can take for the loss?" - It’s a common misconception that you can’t get REP status with a W2. It’s about time, not how much you make.
"When is the deadline to make an S-election for 2025? Can you switch back to sole proprietorship after you elect S-corp in the same year or future years? Do you have to run payroll as an S-corp LLC? What are good indicators or reasons to switch to an S-corp for taxation?" - there's something called late election, very common, we do it all the time. The IRS is very good about allowing it. To be safe it should be done by March 15th.
"I'm converting a barn on my property to an auxiliary dwelling unit for realm purposes. I also have a separate building on the property that I use as a shop office for my construction business. How do I treat these properties for liability and tax purposes?" - the ADU, the Auxiliary Drilling and Dwelling Unit, that's going to be either a long-term rental or a short-term. You could use the shop office as an admin office. I’d wrap it in an LLC and strip the equity out.
“My business doesn't have traditional receipts for its expenses. We primarily rely on bank statements to track our spending. What supporting documentation would I need to provide to the IRS or my tax preparer substantiate these expenses and ensure accurate tax deductions? Are there any alternative methods to proving these expenses without traditional receipts?" - A bank statement, credit card statements, can be used, proof of payments, cancelled checks, etc.
"My business partner and I co-bought a condo in New York City by paying $900,000. He put in $700,000 and own 75%, and I put in $300,000 and own 25%. I'm deeding my ownership to him for $0. What would be his cost basis for future resale?" - Basically this is a gifting, it wasn't, they didn't sell it. So for any amount, so you just carry over the basis. File a 709.
Check out our free Emergency Binder on our website!

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=how-to-move-a-rental-property-to-a-trust-s-corp-for-asset-protection&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-move-a-rental-property-to-a-trust-s-corp-for-asset-protection&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Real Estate Templet on IG

https://www.youtube.com/@ClintCoons

The Real Estate Investing Strategy That is Taking Off

Thu, 30 Jan 2025 05:00:00 -0400

Today Clint Coons, Esq., sits down with Winston Templet, a seasoned real estate investor, developer, and contractor with over 20 years of experience. Based in Tennessee, Winston shares insights from his extensive career, including his early days as a reluctant real estate investor, where he began with trailer parks. They dive into the state of real estate investing in 2025, with Winston emphasizing the shift toward building rather than buying. Winston explains his approach to finding profitable properties, partnering with land sellers, and navigating complex regulations, zoning, and permits. He also offers valuable advice on selecting general contractors, financing options, and how to avoid common pitfalls, particularly for first-time investors. Throughout the conversation, Winston highlights the importance of education and building strong community relationships as keys to success in real estate.

Winston Templet is a seasoned real estate investor, developer, and contractor with over two decades of experience in the industry. Based in Tennessee, he has built a substantial real estate portfolio, demonstrating a keen ability to identify and capitalize on lucrative opportunities in the market. Winston co-founded "The Real Estate Templet," a platform dedicated to educating and empowering individuals of varying experience levels on real estate investment and development. Winston's passion for real estate is matched by his commitment to educating the next generation of real estate professionals. It is his firm belief that education is the key to success.

Highlights/Topics:

Clint’s introduction of guest Winston Templet
A reluctant real estate investor - the trailer park story
The state of investing in 2025, builds instead of buying
How Winston finds properties, sharing wealth with land sellers, partnering for success
Regulations, zoning, permits, etc.
How to approach city and municipal offices, proposing zoning changes
Key costs that must be considered - engineering fees, sprinkler systems, green energy requirements
Financing recommendations, building relationships with community lenders, cash refi’s from other properties
Selecting general contractors - it is crucial to research, get referrals, and hire the right people, never pay money upfront!
First-timer mistakes to watch out for
Setting up protections from liability with the right business entities
Closing comments, final words of advice

Resources:

https://www.instagram.com/realestatetemplet/

The Real Estate Templet On YouTube

https://www.youtube.com/@UCs57I294Kvkpwtw3PQoaXGQ

https://andersonadvisors.com/strategy-session/?utm_source=the-real-estate-investing-strategy-that-is-taking-off&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=the-real-estate-investing-strategy-that-is-taking-off&utm_medium=podcast

https://andersonadvisors.com/

https://andersonadvisors.com/podcast/

https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w

How to Reduce Capital Gains Taxes When Selling a Long-Held Rental Property

Tue, 21 Jan 2025 05:00:00 -0400

Welcome to the first Tax Tuesday episode of 2025. Anderson Advisors attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., discuss topics including whether hours spent on personal and rental properties count towards real estate professional status, the tax implications of using an LLC for a brokerage account that generates short-term capital gains, and how to handle HOA dues when calculating the cost basis of a condominium. They also discuss the consequences of failing to issue a 1099 to contractors, how to navigate a tricky 1031 exchange, and strategies to minimize capital gains taxes when selling a rental property. You’ll hear about ways to structure personal and business finances for educational deductions, managing a 401(k) loan from a tax perspective, and tips for maximizing tax benefits as a 1099 medical professional.

Send your tax questions to taxtuesday@andersonadvisors.com.

Highlights/Topics:

"I have a solo handyman business, do my hours performing services for homeowners and real estate investors properties count towards rep hours. Do my hours working on my residence count towards rep hours if I plan to move out and rent the house?" - Absolutely. That's exactly what you're supposed to do. That time is exactly what we're looking for to get over 750 hours of material participation in the management of your properties, et cetera.
"I am selling weekly options and was advised to put my brokerage account into an LLC taxed as a partnership. Doesn’t this expose me to the same tax liability I have now with no LLC? What is the best tax strategy for a brokerage account that is making a large profit that is all from short-term capital gains?" -No, you're not going to have the same tax liability by putting it in that type of partnership. But there's a lot of other things you can do.
"When calculating the cost basis of a condominium, how does one identify and add the portion of HOA dues spent for capital improvements to the property?" - If it's your personal residence, we don't deduct HOA costs.
"What happens if I don't issue a 1099 to an outside contractor? How do you spend a virtual assistant who made over $15,000?" - You can get penalized up to $600, perhaps more, if you don't get the 1099 out. VA’s overseas, if not a US taxpayer, you don’t need to send a 1099.
"How many properties must I acquire to meet the real estate professional status?" - The number of properties is irrelevant. You could have one, you could have a hundred. It's how much time you put into it.
"I have a rental property that I would like to sell. I purchased it in 1999 for $175, 000. The current value is $450,000–$500,000. How can I reduce capital gains taxes?" - The quick, real easy, no brainer answer, you could do a 1031-like kind of exchange.
"I'm in a 1031 exchange gone bad. The funds are with the intermediary in the escrow account. The replacement property seller did not cooperate and the deal is falling through. Now what can I do?" - Quick answer, you can pay tax. You could try and make the payments in installments.
"Can I structure and set up something through my business and nonprofit or personally that will allow me to deduct my child's college education expenses." "I'm aware of state-specific 529 programs." - You don't get a tax deduction for a 529 plan.
"I currently have a loan on my solo 401(k) and I want to pay it off early and turn around and take out another loan. How do I handle that from a tax perspective?" - You need to check with your particular plan. I just throw that out there for people who are thinking maybe of doing the same.
"I am a 1099 medical professional. What can I do from now on to properly prepare myself to maximize my tax situation? I'm on the payroll for my S-Corp and managing the 1099 income through the S Corp." "I don't know if I should be doing anything else." - Quarterly tax meetings. That's always the answer. Putting it in an S-Corp was the right thing.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=how-to-reduce-capital-gains-taxes-when-selling-a-long-held-rental-property&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=how-to-reduce-capital-gains-taxes-when-selling-a-long-held-rental-property&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Consolidating LLCs Under a Wyoming Holding Company: Is It the Right Move?

Thu, 26 Dec 2024 05:00:00 -0400

It’s our last Tax Tuesday episode of 2024! In this episode, Anderson attorneys Amanda Wynalda, Esq., and Eliot Thomas, Esq., address several listener questions on a variety of tax topics. They cover the tax implications of moving into a rental property, including how it affects capital gains and depreciation. They discuss the possibility of using an LLC as a management company for rental properties, allowing for contributions to a personal IRA. Eliot and Amanda also explain how negative cash flow from rentals can affect deductions and tax filings, the importance of staying organized with rental property expenses, and the consequences of transferring ownership in a 1031 exchange. Other topics include options for offsetting passive income with retirement accounts, consolidating LLCs under a Wyoming holding company, deductions for 529 plans, and the stepped-up basis for gifted stocks. Tune in for expert advice on these and more!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

What are the tax implications of moving into one of our rentals? Bought the property 13 years ago, have never lived in it, taken expenses and depreciation on the returns or should we just rent it from ourselves through our property manager? - Just moving in, no real tax consequence. Once you move in you’re not paying capital gains. The 13 years will be considered ‘non-conforming use’. Don’t rent it to yourself.
I own three rental properties. Can I use that LLC as a management company? Take a 10 to 15% management fee and use that money as an earned income to allow contribution to my personal IRA. Would that contribution be deducted from my rental income as cost to the rentals and Schedule E? When is the deadline for the contribution. My LLC has some expenses too. If my net income is only $3,000, can I still contribute $7,000 to my personal IRA and deduct that amount? - You’re running passive rental income through a mgmt company to make it ‘active’ income, yes you can do this. You need a management agreement that you actually pay before December 31st.
Can I use negative cash flow as a deduction towards income /capable gains? I'm in California and nothing cash flows for at least a few years. If I'm negative $1,000 or more cash flow, is this a deduction against passive income or capital gains? - Capital gains come in when you sell the property. You can pull passive losses from other properties you own.
What expenses are incurred for rental properties or tax deductible and what is the best way to stay organized when keeping records of bills and expensive for rental properties to make it easier at tax time? - Google IRS Schedule E page 1. There is a list there to refer to. Good bookkeeping is essential.
Can I transfer the ownership of a property owned by an LLC tax as a partnership that I purchased as a replacement property in a 1031 exchange or will that trigger a taxable event? - Yes you can transfer, but it will trigger a taxable event.
My wife receives income from multiple sources, real estate rental, consulting, etc. We plan to set up a C Corp to consolidate the passive income and offset some of that income with retirement contributions into a solo 401 (k). Unfortunately, we did not set up the C Corp in time for the tax year 2024. What options do we have with respect to retirement accounts to offset her passive income for 2024. What can we still do? - Consulting is not usually passive income.
Can multiple individual LLCs mix of small business and rentals be consolidated into one tax return under a Wyoming holding company? If so, is that a recommended practice? Adding in a small business? - For rentals this is a standard protection structure, one property per LLC. You can add the active, but we would not recommend it.
How much can we deduct with a 529 plan for our kids?- Some states may give you a deduction, but at the federal level there is no deduction.
If I gift my stock to my aging dad and become the beneficiary the stock when he passes will I get the stepped-up basis after I inherit them? - This is fantastic. Yes, you can do this. This is great, but they have to live for at least one year after the gift, and you have to make sure he’s actually going to leave it to you upon his death!

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=consolidating-llcs-under-a-wyoming-holding-company&utm_medium=podcast

Bookkeeping Packages from Anderson Advisors

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=consolidating-llcs-under-a-wyoming-holding-company&utm_medium=podcast

https://bookkeeping.andersonadvisors.com/

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Staking Crypto: How Are Rewards Taxed?

Tue, 10 Dec 2024 05:00:00 -0400

In this episode of Tax Tuesday, Anderson Advisors attorneys Clint Coon, Esq., and Eliot Thomas, Esq., discuss essential tax strategies for business owners and investors. Topics covered include late S election strategies, the best approach for payroll and officer compensation, and the benefits of Solo 401(k) plans over Roth IRAs. You’ll hear about how to tackle tax implications for cryptocurrency staking, offshore trusts, and real estate professional status. Additional insights include structuring holding companies for real estate investments, deducting rental expenses, and handling business losses. Tune in for expert advice on navigating complex tax decisions.

Send your tax questions to taxtuesday@andersonadvisors.com.

Highlights/Topics:

"I'm considering a late S election effective January 1st of 2024." Okay, so we're going back in time here for an LLC. "I understand it's late in the year to get everything in order. I've heard others recommend an option to avoid payroll for 2024 by issuing a 1099 miscellaneous as officer compensation in lieu of a late payroll, then get payroll set for 2025. Would you suggest this 1099 approach, or is there still time to get payroll done for all of 2024?" - We don't advise this here at Anderson. We want you to roll the proper W-2 payroll. Yes, there's plenty of time.
“What type of businesses do I need to set up a Solo 401(k) or Roth IRA?” - Look at the Solo 401(k) and use the Roth component built into the Solo 401(k) versus doing a Roth IRA because it gives you a little more flexibility in the control of those funds.
"Can you review the contribution rules for a Solo 401(k) and for an IRA in 2024? For instance, when you defer income at year end and make a company match, then also the IRA contribution if possible?” - You can contribute up to $23,000 as the employee, and then the employer can contribute up to 25% of your earned wages
"I invested in a cryptocurrency a few years ago. I have been staking it directly on the network, and in return, I receive a staking reward. How is the crypto activity taxed?" - The staking is usually considered ordinary income. That means it's going to be taxed at ordinary rates and very likely is subject to employment taxes.
“I've been considering opening an offshore trust that owns an offshore LLC that engages in forex day trading business in the Cayman Islands. I only pay taxes on distributions received from the trust that way, I can grow capital outside the US. Am I on the right path here? And are there other consequences that I should consider?” - The way the US taxes individuals is that when we say worldwide income, it's not the income you earn in your own name. It's also the income that you earn through entities that you hold an interest in.
"I have a real estate professional status." (We call it REP status for short.) "I have invested in both traditional, rentals, and syndications, both use cost segregation and bonus depreciation. Can I claim the paper loss from real estate syndications together with our other rental activity after electing to aggregate all real estate activity? Is it allowed to claim all losses, or the ones from syndications disallowed?" - You have to work over 750 hours in a real estate trade or business that you ‘materially participate’ in. That could be I sell houses, real estate agent, things like that. I manage houses, anything like that, and that has to be over 50% of your work week. Typically, it's difficult to do if you have a W-2 job.
"I own three separate holding companies, LLC taxed as a partnership for my real estate." We'd always recommend that, some oil, and mineral rights. "A second taxed as a partnership for active real estate flips." We might have an issue with that. "S-corporation for technology consulting." "I saw Anderson videos on holding a passive brokerage account, not active trading, in an LLC for asset protection. Where do you recommend I'd place this? Would it go into one of these other LLCs or some other holding company? I would prefer to avoid an extra annual federal tax filing if possible." - I would keep it completely separate because you've got this one set up for the oil, this one set up for the real estate, this one here is our active business. Putting your brokerage, your savings account into any of those entities just wouldn't make sense to me.
"I have a primary residence that I plan to rent after one year, which would be in December. If I put it into service this year, can I deduct expenses that were needed to make it ready for that rental, such as a cost seg for this year?” - It’s a question of when it is placed into service. If we've already placed it in the services and we start, depending on what we're doing to improve on it, if it is just an improvement, that's still just going to go to basis, and we would depreciate it now that it's a rental.
“Clint recommends using a partnership holding company for residential real estate investment. "Do I need to start a new IRS filing submission with a partnership holding company or keep it on my existing Schedule E, personal IRS filing? I have 25 investment homes, so I'd like to minimize the amount of work for this change. I'm not sure how to do this accounting change." - You can write out 25 little boxes down here that all lead up to just one entity, Wyoming holding. We'll make them do all 25.
"I have a relatively new corporation whose expenses exceed income," so we've got losses. "Can these expenses be used to offset income in 2025? If so, how would I indicate this on this year's tax return?" - If we have more expenses than income, it's a loss, it can carry forward into the next year.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=staking-crypto-how-are-rewards-taxed?&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=staking-crypto-how-are-rewards-taxed?&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

Demystifying Cost Segregation: How Landlords Can Maximize Tax Savings on Property Investments

Tue, 26 Nov 2024 05:00:00 -0400

In this episode of Tax Tuesday, Anderson Advisors attorneys Eliot Thomas, Esq., and Amanda Wynalda, Esq., dive into various tax strategies. You’ll hear about renting property to your business, self-rental rules, and IRS grouping options. Then, we address the sale of a California primary residence, including the $500,000 capital gains exclusion for married couples. We’ll explore cost segregation for landlords and the 1244 stock loss provision for individuals. We also have answers about tax implications for C Corps, including reimbursement rules for accountability plans and transitioning from LLCs. Lastly, we touch on Opportunity Zones, rental property sales strategies like 1031 exchanges, and the tax impact of converting a rental to a primary residence.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

So can I rent real property to my business? - Check self-rental rules, and the ‘grouping’ option from the IRS
Just sold our primary California residents in July for a million and ninety thousand dollars. We purchased it five years ago for six hundred and fifty thousand, with three hundred thousand down and a three hundred fifty-thousand-dollar mortgage. Any taxes due considering the 121 married filing joint exclusion of five hundred000 capital gains. - We're going to look at the sales price, less our ‘adjusted basis.’
Could you give an example about cost segregation? Have you heard? I have heard you talk a lot about it and they're kind of confused. I'm thinking about becoming a landlord. How can I do a cost segregation on, for example, the appliances that come with a purchased property? - The building itself has straight-line depreciation over many years. Contents of the building are depreciated at different rates.
Is the 1244 stock loss provision, a $50,000 tax credit, that is dollar for dollar, against your 2024 interest, social security and passive incomes on your 1040 for 2024. - 1244 is only applicable to individuals, as a deduction/loss. It reduces your taxable income.
When using the accountability plan for a C Corp, do the charges have to be made from the employee's personal account to qualify, and what happens if those charges are made on the company credit card? - The individual needs to pay for them first personally of their own pocket for a reasonable business expense, then submit for reimbursement.
We purchased our first commercial building this year. Even though I knew in the back of my mind the property was in an opportunity zone, it did not hit me until a couple days ago. Is there still an advantage for us to go into the opportunity zone route? I believe the only benefit at this point is a 10-year mark and step-up in basis. Is this correct? I believe there would be some elections we would have to make in a fund. Can you explain how it all gets set up and what we would need to do? - Once you obtain that property, a stopwatch starts, and you have 30 months to substantially improve it. You had to put the funds into the Opportunity Zone fund, which is the business entity, and then purchase the property there, not going to be able to back into it.
We are changing our LLC from being disregarded to being a C corporation. Over the year we have moved substantial money from our LLC to our personal accounts as distributions. Do we need to relabel those as dividends and would we be able to transfer the funds back, or does the C Corp election only affect forms from the date of transition, meaning we'll file a split return 1040 for a disregarded entity, 1120 for the C Corp? Thank you for all the great media you guys put out. - Nothing happens with the previous activity, but going forward you can’t take money out in the same way.
We have rental property bought originally in 1991 as our residence. The current tenants want to purchase the property. What is the best way to approach this? To lower capital gains, we are considering using the funds either to purchase another property or invest in tax liens and deeds. - You have a lot of options. Installment payments, interest from seller financing, or 1031 exchange
What are the tax implications of moving into a house that has been held as a rental for 12 years? They've never lived in it themselves. - What is your value/investment in the house? That becomes your adjusted basis when you move in, for future tax purposes. Many items are no longer deductible if they become your personal residence.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=demystifying-cost-segregationt&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=demystifying-cost-segregationt&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Turning Your Home into a Rental: Keeping Your 121 Exclusion Intact

Tue, 12 Nov 2024 05:00:00 -0400

n this episode of Tax Tuesday, Anderson Advisors attorneys Eliot Thomas, Esq., and Toby Mathis, Esq., tackle a variety of listener questions. Topics include strategies for managing cryptocurrency gains, converting a primary home to a rental without losing the 121 exclusion, and navigating the primary residence exclusion when selling a home. They also discuss the benefits of forming an LLC for consulting income, handling rehab costs for a fix-and-flip property, and meeting the Real Estate Professional criteria for tax purposes. Toby and Eliot dive into depreciation recapture, 1031 exchanges, and how to structure property ownership to avoid taxable events. Tune in for expert insights on real estate and tax strategies for investors and homeowners alike.
Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

By crypto, I bought $125,000, $24,000 invested $30,000 is now over $1 million, scared to sell because of the 35 % tax. Hold on until $125,000, $25,000 for 20%, but I'm scared the price is in my portfolio. How can I get around the 35 % legally? - If you will have other losses from other sales, you can use those to offset in the short-term…
How do I convert my primary home into a rental without losing the 121 exclusion? - You can do this but you must meet the 5-year primary residence provision.
My wife and I are selling our primary residence. We'll be listing the house for sale before we have lived in it quite two years. But assuming that closing takes about 90 days, it'll be over two years at the closing. Will this be acceptable for using the primary residence exclusion? - The clock starts when you have the title in possession, so the clock also STOPS when the new buyer takes possession of the title.
I will be starting a consulting position in December. Is it better to create a LLC to receive wages or should I receive funds in my name? What are the benefits of creating the LLC? - If your employer agrees to pay you with 1099, you should have an S or C Corp LLC to protect your wages.
We haven't sold our fix-and-flip property After one year and are considering renting it instead How should we handle the rehab costs and office expenses and our tax return? The property is held in a disregarded LLC. - First we have to establish your “intent” - if you weren’t sure… you’re ok to leave it in that disregarded entity.
I've never been able to claim real estate professional due to a full-time W2 job. As of December 31st, 2023, I took early retirement. However, I was paid a severance until December 2024. During 2024, I have been leasing, advertising, physically rehabbing new property, responding to maintenance, etc. I'm also a licensed real estate broker in Kentucky where my properties are. I materially participate in 100 % of the rental activities. Can I claim real estate professional for 2024, even though I was being paid severance but not working my previous corporate job? - Yes, you can, as long as you meet the REP criteria.
When calculating capital gain from the sell of a rental property is the gain from the depreciated cost basis or cost basis after the depreciation recaptured. It's the gain from the recapture cost basis or cost basis. For example, I bought at $100,000, sold at $200,000, that's how you're supposed to do it, had $50,000 in depreciation. Woo. Would it be $100,000 capital gains tax plus the tax on the $50,000 depreciation recovered or $150,000 capital gains? - The first 50,000 is what's subject to depreciation recapture…the 100K is “straight capital gain”
I know it's a broad question, but would love for you guys to discuss depreciation recapture at sale after cost segregation has been formed on an investment property. If it helps, you could do, it could be a cost segregation on a pizza shop. - it depends on the different categories of whatever was in the building.
Our rental LLC owned by a Wyoming holding LLC sold a Toronto property for a huge gain. We hear all these huge gains today. Like all you guys are making money, but we plan to 1031 rates. Our qualified intermediary informed us that the replacement party property should be under the name of the same LLC that sold the property. How can we move the ownership of the 1031 new property into a new LLC without triggering a legal and /or taxable event, how can we protect the assets of the new property if we can only be under the name of the old rental LLC? We want to dissolve the old rental LLC. - if you do this properly through a qualified intermediary, that's a neutral third party that handles all the funds, you may be able to defer all the gain.
We are a group of four investors and we have an apartment rental complex, 12 units, and a separate single-family rental. We would like to exchange both of those properties and invest into a motel. Can we exchange the residential rental properties for a business real estate property? - Yes is the quick answer, must be “used in a trade or business”

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=turning-your-home-into-a-rental-keeping-your-121-exclusion-intact&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=turning-your-home-into-a-rental-keeping-your-121-exclusion-intact&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

Can You Deduct Tenant Damage and Cleanup Costs on Your Taxes?

Tue, 29 Oct 2024 05:00:00 -0300

In this episode of Tax Tuesday, Anderson Advisors attorneys Eliot Thomas, Esq., and Toby Mathis, Esq., tackle a variety of listener questions related to tax deductions and property management. They discuss the implications of evicting tenants and the possibility of deducting repair costs, as well as how homeowners can deduct home office repairs. You’ll hear about the process for amending tax returns to include rental properties and explore the tax consequences of receiving large gifts from non-U.S. citizens. Additionally, they cover topics like the advantages of S-corp versus C-corp structures, the requirements for achieving real estate professional status, and the nuances of short-term property sales, including 1031 exchanges. Tune in for expert insights that could impact your tax strategy!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"We rented our house last year due to damages caused by the tenant violations of the agreement. We evicted them." "The tenant abandoned the property with their belongings." "With proper judgment and the sheriff's help, we evicted them and cleaned the property. The tenant caused too much damage. Can we include the cost of fixing it on our taxes?" - yes, and we have two categories, repairs or improvements.
"I work from home. I already take deductions for my home office. If there is a repair in the house like plumbing or an appliance repair, am I able to take a percentage of that repair off as a deduction?" - As a general matter, yes.
"In 2022, I bought and rented a rental property, but I never put the property on my tax return. Can I now add this property to my tax return and take advantage of the tax deductions, cost of ownership, et cetera? Is there a limitation on how far back someone can amend a tax return or add a rental property purchase in the past?" - yes, you can. Is there a limit to how far back? Yes, I'll hit the limit first, three years from the date that you filed.
"My parents live in Singapore and are not US citizens. They want to give me and my kids $200,000.”“They have not previously gifted us any funds. Will any of us need to pay tax on this?" - Generally speaking, I don't know of a tax necessarily if you have non-US citizens giving cash gifts over to their children or family.
"Is there a different procedure to buy a residential multifamily with a pizzeria?" "Is there a different procedure to buy a multifamily with the pizzeria running downstairs?""We have our long-term rental properties with LLC. How should we proceed with this? Can we do a cost segregation study and take bonus depreciation on this type of property and take advantage of the passive deductions?" - For both, you can go ahead and do a cost segregation study, see if it would be in your favor—usually it is
"What type of activities can I log toward REP (real estate professional) status, as a real estate agent? For example, working at home on my website, market research, advertising. Does having a home office mean my time driving to and from showings counts as time? Is education either required or optional?" - If you meet the criteria, then that turns it from passive to non-passive. if you spend over 750 hours in a particular trade or business
"What are the tax consequences if I sell a property in less than a year of purchase? Does the same apply to manufactured homes? And would they be able to do a 1031 exchange if there's profit on the sale?" - What was your intent? Was it to flip? That is a different scenario than short-term gains. Manufactured homes need to look at state laws.
"Why should I open an S-corp versus a C-corp?" - There are many differences to consider.
"Can you please explain the 100-hour material participation in detail? You participated in the activity for more than 100 hours during the tax year, and you participated at least as much as any other individual, including individuals who didn't own any interest in the activity for the year." "For example, if I materially participated in my rental activity for 100 hours during a tax year, can I claim 100% tax deductions on my losses, expenses, and my business activity under this test alone?" - No, it doesn’t work that way. You need REP status.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=can-you-deduct-tenant-damage-and-cleanup-costs-on-your-taxes&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=can-you-deduct-tenant-damage-and-cleanup-costs-on-your-taxes&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Alliance Virtual Offices Offer for Listeners

https://www.youtube.com/@ClintCoons

5 Reasons To Ditch Traditional Office Space: The Office-Free Entrepreneur

Wed, 23 Oct 2024 05:00:00 -0300

In this episode, Toby Mathis, Esq., of Anderson Business Advisors, sits down with Mike Sullivan from Alliance Virtual Offices to discuss the evolving landscape of workspaces. Mike details five compelling reasons to abandon traditional office spaces, highlighting Alliance's impressive 40 years in the industry, with 20 years dedicated to virtual solutions. The discussion demystifies the concept of a "virtual office," likening it to the 'Airbnb' of office rentals. Listeners will learn about the array of services offered, including phone support, professional addresses, receptionists, and flexible meeting spaces—all for a budget-friendly monthly cost.

Virtual offices can mitigate risks associated with rising rent and personnel disputes, providing the flexibility needed for businesses to thrive. Ideal for those navigating talent needs or seeking cost-effectiveness, Alliance also offers rental agreements that start with a six-month minimum, transitioning to month-to-month options. Tune in to discover how virtual offices can transform your business strategy!

Highlights/Topics:

Five key reasons to ditch your office space
Alliance’s 40 years in the business - 20 years virtual
Ambiguity – exactly what is a “virtual office”?
The ‘Airbnb’ of office space
Services available - phone number, operators, address, receptionist, meeting space, workspace
Monthly cost of $50-$70 per month globally
Rent on an as-needed basis, for example, attorneys are the largest percentage of renters
Mitigating risk/credit - eliminating rising monthly rent, credit, personnel disputes or conflicts, separating business from personal
Flexibility is key for hiring and cost-effectiveness
Talent needs - if employees are unable to work from home
Rental agreements - 6-month minimum, then month-to-month is available
Utilizing space for private interviews
Share this with new investors you know

Resources:

https://www.alliancevirtualoffices.com/lp/anderson-advisors?gspk=YW5kZXJzb25hZHZpc29yczUyNDA&gsxid=YHqclhuYOPk8&pscd=ps.alliancevirtualoffices.com

Schedule Your FREE Anderson Consultation

https://andersonadvisors.com/strategy-session/?utm_source=5-reasons-to-ditch-traditional-office-space&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=5-reasons-to-ditch-traditional-office-space&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Tax Strategies and Tips for Starting an Online Business

Fri, 18 Oct 2024 05:00:00 -0300

This episode of Tax Tuesday with Anderson Advisors attorneys Eliot Thomas, Esq., and Toby Mathis, Esq., tackle pressing issues faced by business owners and real estate investors. From the implications of switching health care reimbursements from a C-corporation to an LLC, to short-term rental strategies, Eliot and Toby discuss the 100-hour participation test and how to select the right property. Other topics include the intricacies of real estate professional status, the deductibility of expenses for damaged properties, and the mechanics of Qualified Business Income (QBI) deductions. Finally, listeners learn about tax management for online businesses (at 46:17) and the potential tax liabilities of renting secondary homes through an S-corp.
Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"I currently reimburse myself for health care expenses through my C-corporation. I have another completely separate business that I run through an LLC registered in Wyoming. Are there any issues if I switch my health care reimbursement from the C-corp over to the LLC?" - It depends- who is it disregarded to? A C-corp can reimburse health expenses.
"We want to take advantage of the short-term rental loophole strategy. If we buy a house in October and close in November, would I have enough time to reach the 100-hour test? What kind of house should we focus on?? - There are several different tests for material participation, one of them being at least 100 hours and more than anybody else. But there are 7 total tests.
"Regarding real estate professional status, the code says you have to participate 500 hours materially or have been rep for the last five years." Actually, there are seven tests, but we'll get into that. "Does that mean if a spouse has been a rep for the past five years, he or she can be hands-off for the next three to five years and still claim rep to offset the other spouse's W-2?" - Long-term rentals are passive income normally, but REP status changes that, although it has certain requirements
"We bought a small house. The house was in a fire and had a lot of damage. We spent a lot of money on structural engineering, services, roof, and other support of construction. This was needed for the safety of workers. They would not be able to work otherwise. My CPA told me I can't take any of those expenses as deductions because I have not rented the house yet. Please be so kind and tell me why I can't deduct structural engineering expenses of more than 12,000. My CPA told me I can only deduct utilities such as water and electricity. That's it." - The code is the code, you can’t deduct for a rental until it is in service…the write-off comes over cost seg
"Can you go over QBI in detail? And do I deduct 20% QBI from net or gross profit? Also, do I deduct 20% first, then my expenses, or do I choose either 20% or my expenses?" - First you find your net, then there are five different qualifications
"If I sell a house on an agreement for deed, how are the monthly payments that I receive taxed?" - If you used it as a rental, you’ll have depreciation recapture. “For deed” means you’re selling it over time.
[46:17] "I'm considering starting an online business. I'd like to know strategies and how to manage taxes as best as possible."- Start by putting it in an LLC, tax it as S or C-Corp, be aware of state requirements…
"Could I have my S-corp rent my secondary home when the business takes clients on retreat? While this may create an expense on the business side, does it also create a tax liability on our 1040?" - How is the second home currently being used? If it's already a rental, you may hit some limitations…
"Does changing the floor and painting the walls count as repair, or is it a renovation?" - Painting is usually a repair, you can write that off. Flooring has other requirements.
"Can I take a six-figure distribution from my S-corp and have it not affect my social security? If the corporation shows a profit and I'm the CFO, will this affect my social security?" You have to take a reasonable wage in order to get that credit.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=tax-strategies-and-tips-for-starting-an-online-business&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=tax-strategies-and-tips-for-starting-an-online-business&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Can You Use a 1031 Exchange for Property Flips Under One Year?

Tue, 01 Oct 2024 05:00:00 -0300

In this episode of Tax Tuesday with Anderson Advisors attorneys Eliot Thomas, Esq., and Amanda Wynalda, Esq., we dive into essential real estate investment strategies and tax implications for property owners. Discover why selling a rental property to your LLC is considered a prohibited transaction and learn how to protect capital gains from your primary residence using the 121 exclusion. We discuss the limitations of 1031 exchanges for properties flipped within a year and outline how to determine a reasonable salary from your S-Corp while considering payroll taxes. Additionally, we clarify the requirements for maintaining real estate professional status, the treatment of capital gains within an S-Corp, and the nuances of deductions for short-term rentals. Tune in for valuable insights to optimize your investments!

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

I just purchased a property through a self-directed IRA and LLC. I own a rental property. Will I be able to sell the rental property to my LLC? - No, you cannot personally benefit, this is a prohibited transaction.
How can I protect the capital gains from selling my primary residence after adjusting the cost basis? And after taking the 121 exclusion and utilizing that money for investment purposes. - If the home was used as a personal residence for two of the last five years, you might be able to take some money off - it's 250,000 if you're single, 500,000 married filing joint.
Can I use the 1031 exchange when flipping properties under one year of ownership? - The IRS looks at the property as “inventory.” So although it is being used in a ‘trade or business’ you can’t use the 1031.
How do you determine the right pay for yourself? Is it worth the taxes you pay into Medicare and Social Security? So far, we've paid $30,000 in payroll taxes. Will that go towards our tax bill at the end of the year? - You have a ‘reasonable salary requirement’ from an S-Corp. It ranges from 38% to 60%.
What minimum must you do to maintain your real estate professional status and not be considered a dealer if you intend to flip a house? - REP status is when you spend 50% of your personal services time and at least 750 hours in your real estate trade or business.
What happens with the capital gain from stocks or from the sale of a rental property when inside of an S-Corp? - It is not ‘ordinary income’- the building is under “separately stated”.
What is the list of deductions with a STR that's a short-term rental for those of you in the know in the REI, as passive income when material participation is not met compared to a list of deductions when material participation is met? - There is no difference between passive and non-passive deductions. Google IRS PDF Schedule E.
If I volunteer my work or time at a nonprofit, is this tax-deductible? - the short answer is no, but you can deduct things like mileage
I have a W-2 and 1099 income. Bought a house to flip. How can I best take advantage of this financially to save on tax? - you may be able to run certain deductions against your income.
How does rental property via an LLC affect personal taxes? - we get this question all the time recently. Set up in a disregarded LLC, no impact at all on your personal taxes.

Resources:

https://andersonadvisors.com/ss/

https://andersonadvisors.com/live-tax-and-asset-protection-workshops/

https://andersonadvisors.com/

1031 Exchange for Real Estate Investors (HUGE TAX SAVINGS!)

Tue, 24 Sep 2024 05:00:00 -0300

Today Clint Coons, Esq., speaks with Aaron Kancevicius, the Lead 1031 Advisor/Director of Lending at Plenti Financial. Aaron takes us through the ins and outs of navigating the IRS’ 1031 exchange guidelines for investment properties. Aaron and Clint discuss the essentials of setting up a 1031 exchange, the importance of consulting with a CPA, and the necessity of a qualified intermediary. Aaron clarifies the complexities of depreciation, depreciation recapture, and the "like-kind" property rule. He outlines the critical timelines, including the 45-day identification and 180-day closing periods, offering tips for effective portfolio diversification. Additionally, you’ll hear advanced strategies like standard and reverse exchanges and transitioning properties to personal residences, making this episode invaluable for serious real estate investors.
Aaron Kancevicius is from Plenti Financial, a leading 1031 exchange consulting firm in Southern California with over 20 years of experience in real estate finance. Aaron has helped countless real estate investors evaluate deals from as little as $100K to over $100 million.

Highlights/Topics:

Clint’s introduction of guest Aaron Kancevicius
How you can arrange for a 1031 exchange
When in the process do you need to apply for a 1031?
Debt, loans, timing
Parameters for avoiding capital gains taxes
Are there complications with cost segs on properties?
Complexities of the “Like/Kind” IRS regulation
Diversifying with a 1031, limitations
Working with contractors on improvements
Related party transactions
Cash-out refi’s
Considering exchanges from US to International
Drop-n-Swaps, reverse exchanges, selling multiple properties, combo exchanges
Can you use a 1031 to purchase a primary residence vs. an investment properties?
Other uncommon situations, mistakes Aaron has witnessed
Closing comments - contact an expert before you embark on a 1031 exchange

Resources:

Plenti Financial

https://www.startmyexchange.com/anderson

https://andersonadvisors.com/strategy-session/?utm_source=1031-exchange-for-real-estate-Investors-HUGE-TAX-SAVINGS&utm_medium=podcast

https://andersonadvisors.com/live-tax-and-asset-protection-workshops/

https://andersonadvisors.com/

https://andersonadvisors.com/podcast/

https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w

Strategies to Reduce Your Tax Liability as a Real Estate Flipper

Tue, 17 Sep 2024 05:00:00 -0300

In this episode of Tax Tuesday with Anderson Advisors attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., the pressing tax questions from listeners have a special focus on real estate issues. They dive into the complexities of tax benefits for short-term and long-term rental properties, addressing specific monetary scenarios. Toby and Eliot also explore the nuances of passive losses and real estate professional status, evaluating how a limited partnership investment and syndications impact tax strategies. Additionally, they clarify the effects of installment sales on capital gains tax, the tax implications of long-term capital gains for incomes below $93,000, and strategies for reducing tax liability as a real estate flipper. You’ll hear about the mechanics of 1031 exchanges, the use of solar credits against passive income, and the treatment of repairs versus improvements on rental properties. Tune in for expert advice on optimizing your tax situation in the real estate world.
Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"Professor One has three short-term rentals, seven days or less." "He generates $20,000 of profit from each one, but each generates $60,000 of losses, cost seg plus bonus depreciation." "Can he use 20% QBI?" that's 199A. "Can you use it on the $20,000 profits, or will those be offset by the $60,000 losses, and the net will be $40,000 each?" –We can't. We have to take in the $60,000 loss that's associated with each of those buildings. We don't take QBI against the loss. No, QBI would not be available here.
"Professor Two has four long term rentals, and he used line depreciation for all of them." "His wife is a real estate professional, but there's not enough losses to offset his $300,000 grand in income. The CPA suggests putting $200,000 in a syndication as an LP. K1 will generate $150,000 of losses. As long as his wife is REP, he can use those passive losses to offset his W-2. Is that true?" – Because we're introducing a syndication, and this is a limited partner, that's the LP here at K-1, we're going to have to meet that test, the 500-hour test. In other words, to get our REP status, if we didn't use the 500-hour test, we may not be able to do that. That's why I say it depends.
"Professor Three has one passive long-term rental and just bought two short-term rentals with seven days or less with cost seg plus bonus depreciation. Next year, 2025, his wife plans to retire and claim real estate professional status. The plan is to keep those short-term rentals as Airbnb with eight days or more, a.k.a passive, and keep the long-term rental as is. The first question is, can the wife manage, clean those Airbnbs and claim the 750 hours without touching the third long-term rental that is far away and group them all together?" – I'm going to say no, because remember, a short-term rental isn't rental activity. It's the pizza shop, okay, that Toby keeps talking about. But we have other ideas.
“The second question is whether we can still use the losses from the cost seg we conducted on those two short-term rentals this year." – Losses will stay passive into the future, so no.
"I have a question about capital gains tax. I'm selling a property with an installment payment plan. Only two installments to be received. The first will be received December of 2024, the second and last payment will be January 2025. How will this affect my capital gains tax?" – Simplistically, it's just going to split them.
"Paying tax on real estate long-term gain. If my net income is under $93,000 in 2024, will I owe taxes on long-term capital gains from the sale of real estate, a vacation rental? The gain itself is over $93,000." – if you are below approximately $94,000 in 2024, it's going to be taxed at zero.
"How do I reduce my tax liability as a flipper?" – Do it in a C-Corp or S-Corp, besides just immediate tax deductions, we want to avoid dealer status.
Reverse exchange 1031. "Please help us understand it. How do I choose a QI, which stands for qualified intermediary? Any recommendations for first-time 1031 exchangers?" – you're first buying the replacement property and then you're deciding within 45 days which you're going to give up. And so it's just the opposite direction. You have 108 days total from close to close.
"Is it possible to use solar credits against passive income from real estate rent income?” – Yes. You can have a solar credit. You could do it on your personal home, which would create an ordinary loss. The nature of the activity that the solar is attached to might have something to do with its tax treatment.
"How do you determine if a repair and a rental property can be treated as an expense in the current year or must be depreciated?" – If you're making the property more valuable by doing it, that's not a repair. You're making it more valuable.
"Hi, my husband and I want to sell a new construction home business to become full-time investors and manage our five large commercial properties. In the past, we've had real estate professional status because we self-managed our commercial properties. If we sell our construction business, do we still qualify for rep status if we start a management company to manage our commercial properties and earn W-2 income from this new company? What type of entity would be best to set up a management company, LLC, S-corp, or C-corp? – using that management company that you own yourself, certainly you can use that towards your time.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=strategies-to-reduce-your-tax-liability-as-a-real-estate-flipper&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=strategies-to-reduce-your-tax-liability-as-a-real-estate-flipper&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Renting Out a Property Without An LLC

Mon, 09 Sep 2024 05:00:00 -0300

In this episode, Toby Mathis, Esq., of Anderson Business Advisors, sits down with Brent Nagy, a highly accomplished real estate investor with over 20 years in the industry. Brent, who retired by the age of 40 with a portfolio of more than 50 cash-flowing properties, shares his expertise around the critical importance of proper asset protection, cautioning against owning real estate outside of a formal LLC or entity. He discusses common pitfalls and liability issues associated with residential properties, highlighting that a well-structured investment strategy can significantly reduce stress and risk. With a wealth of experience, Brent underscores that good intentions alone are not enough—talking to other investors and understanding protection as a vital cost of doing business is essential for long-term success.

Highlights/Topics:

Toby introduces Brent, his back story and progression
Making money passively, “Rich Dad Poor Dad”, becoming an investor
Owning real estate outside of an LLC or entity - NEVER
Proper structure and proper protection is paramount for investing in real estate
Residential properties - liability examples and faulty advice
So much stress can be avoided with the right structure in place
Good intentions can never trump experience
Talk to other investors, protection is the ‘cost of doing business’
Share this with new investors you know

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=renting-out-a-property-without-an-llc&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=renting-out-a-property-without-an-llc&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

How to Avoid Taxes When Selling Your Rental Property
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What Is The Best Way To Avoid Estate Taxes?

Wed, 04 Sep 2024 05:00:00 -0300

Today, attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., answer listener questions with a focus on various strategies for minimizing estate and income taxes. You’ll hear about how to use non-profits or irrevocable trusts to avoid estate taxes, structuring an assisted care business with asset protection strategies, and setting up single-member LLCs taxed as S-Corps. For short-term rental tax deductions, it's clarified that a property can’t serve both vacation and business purposes. The questions also address investment in qualified opportunity zones or QOZ’s, 1099 tax options for truck drivers and other independent contractors, deducting home improvement costs, and alternatives to 1031 exchanges.
Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

What is the best way to avoid estate tax? - Setting up a non-profit, or an irrevocable trust. Currently, only estates over $13 million get a federal tax
I'm a nurse. I'm interested in starting an assisted care business in my home. Any recommendations to use for taxes or startup strategies? - Focus on asset protection - separate your building vs. operations in an LLC. You’ll need good insurance and other protections for anyone coming into your home.
My wife has a single-member LLC engineering firm and it's taxed as an SCorp. I plan to open my own business. Would I be able to open my own single-member LLC tax as an S -Corp? My CPA advised me to run my business through hers so that only one 1120S is filed. - Yes to the SCorp and NO to running through your wife’s LLC. If you get sued someone can take everything from you.
Can I use my vacation home as a short-term rental to tax write-off? So how do we do that? - it's either vacation or it's business, you don't do both, okay?
I hear a lot about seven average days, but there is a lot of confusion behind those seven days. - The only reason there's confusion is because people don't know how to read the regs…
I’ve realized capital gains from an installment sale in 2023. I've not received capital gains up to my basis yet. I will have a chunk every year up to the next five years. Can I still invest in a qualified opportunity zone? - QOZ’s are ending at the end of 2026
I would like to focus on 1099-related options. I'm a truck driver, and I feel I'm paying very high taxes. - This is broader than just truckers, but don’t start a sole proprietorship, try a C or S- Corp to cut down employment taxes.
Sold our investment property in 2023, which was previously our residence for 10 years. When we started renting out our property about five years ago, our CPA did not advise us on updating the cost basis because you don't. Right. We have done many upgrades to the house during the 10-year stay. So this year, when we file our taxes and report the sale, we will be using the initial cost basis for the home. My question is, any way to deduct the expenses we had when it was our residence? - See form 315 to capture that missed depreciation.
I see different ads from others saying there are options other than a 1031 exchange to defer taxes. Looking for any viable options, please. - We can look for UPREITS, Umbrella, partnership, real estate investment trust, things like that.
Being a senior over 70, I really enjoy the videos I watch on YouTube as it's never too late to learn and try to understand real estate investing in taxes. But even if I do pick up some of the things, I still would need experts to do the job for me. What would it cost for Anderson's group to follow my future investments? I want to do this for my daughter who is now in her second year of college. - If you want turn-key investing, come to infinity investing

Resources:

The $100K+ Retirement Plan You Need to Know About

Thu, 22 Aug 2024 05:00:00 -0300

In this episode of Anderson Business Advisors, Toby Mathis, Esq., speaks with Jeff Mason and Chris Hammond from Redwood Retirement on the intricacies of $100,000+ cash balance retirement plans, focusing on how innovative solutions can benefit business owners. They explore the key aspects of these plans, including what can be paid and deducted, the hurdles involved, and the flexibility they offer. The discussion covers the effectiveness of Redwood's solutions, highlighting when payments are due for the tax year and showcasing best-case examples of significant tax savings achieved through cash balance plans. Chris and Jeff also clarify the differences between Cash Balance Plans and Defined Benefit Plans, explain the limits and maximum contributions, and introduce a sample plan for effective modeling. With insights into flexibility, payroll funding, and real-world case study outcomes, this episode is a comprehensive guide to leveraging cash balance plans for optimal retirement planning and tax efficiency.

Highlights/Topics:

Chris and Jeff intro, Redwood Retirement and their cash balance plans
Liability - what you can pay and deduct, hurdles, flexibility
Redwood’s solutions, proof of effectiveness
When are payments due for the tax year?
Best case examples of cash balance plans and their tax savings
Definitions and differences - Cash Balance Plan vs. Defined Benefit Plan
Limits and maximum contributions
Modeling a ‘Toby Mathis plan’
What all this means for business owners
Flexibility, funding with payroll
Favorite case study outcomes
If you want to speak with Jeff and Chris - click the link below to see if their services can help you!

Resources:

Do you want to discuss if a Redwood Retirement Cash Balance Plan Design is right for your company?

👉 Visit: https://redwoodrs.com/tobypodcast

https://redwoodrs.com/tobypodcast

Email Jeff Mason

jmason@redwoodrs.com

https://andersonadvisors.com/strategy-session/?utm_source=the-$100K-retirement-plan-you-need-to-know-about&utm_medium=podcast

https://andersonadvisors.com/live-tax-and-asset-protection-workshops/

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

How The Federal Pivot Could Shake Up The Stock Market: Are You Ready?

Wed, 21 Aug 2024 05:00:00 -0300

In this episode, Toby Mathis, Esq., of Anderson Business Advisors welcomes Erik Dodds- a seasoned financial planner, fiduciary, and active trader. Together, they delve into the anticipated pivot of the Federal Reserve from a hawkish to a dovish stance and its potential impacts on the market. Erik provides an in-depth analysis of historical trends and recent economic indicators to forecast future market movements, particularly focusing on the S&P 500 and its ETF proxy, SPY. He shares valuable investment strategies for both traders and long-term investors, including the use of covered calls, caller strategies, and understanding option Delta for optimizing strike selection and income generation. To stay informed and proactive, Dodds offers insights on how to prepare your portfolios for financial fluctuations and maximize returns amidst market volatility.

Highlights/Topics:

Toby introduces Erik Dodds to discuss the Federal Reserve's pivot
What a Fed pivot involves, shifting interest rates
Fed's current interest rate status and lack of recent changes
Rate cuts might appear in September or December 2024
Market expectations for Fed rate cuts fluctuate with economic data
Historical Fed pivots often lead to market downturns
Options strategies can protect portfolios during market declines
Wealthy individuals are most impacted by market volatility
Long-term investors should focus on portfolio protection and consistent buying
Advice for investors on protecting portfolios and managing risk

Resources:

Join our FREE Infinity Investing Basic Membership and get a complimentary digital copy of the Infinity Investing book!

https://infinityinvesting.com/pricing/?utm_source=how-the-federal-pivot-could-shake-up-the-stock-market&utm_medium=podcast

https://andersonadvisors.com/strategy-session/?utm_source=how-the-federal-pivot-could-shake-up-the-stock-market&utm_medium=podcast

MarketWatch Article

https://www.marketwatch.com/livecoverage/stock-market-today-s-p-500-futures-inch-higher-as-ai-frenzy-continues/card/stocks-fell-21-on-average-after-first-fed-rate-cut-since-the-1970s-says-comerica-xr9yBoZ9PeIkFpOeqfE8

https://andersonadvisors.com/live-tax-and-asset-protection-workshops/

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

How to Save Taxes When Flipping Houses

Tue, 20 Aug 2024 05:00:00 -0300

Today, attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., answer listener questions with a focus on optimizing tax outcomes for real estate investors and crypto enthusiasts. We explore strategies for handling income through complex entity structures, such as using an LLC and a C-corp to manage staking income and fund a 401(k). We also discuss the timing of LLC formation for crypto investments and how flipping houses can be structured within a C-corp or S-corp to minimize taxes. Listeners will learn about managing losses on short-term rental cabins, the implications of renting out a portion of your home, and the nuances of filing multiple LLC tax returns. Plus, we address how to handle passive losses if you're a real estate professional.

Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"As a tax strategy, let's say let's say I set up a trading LLC entity and a C-corp entity that owns 49% of the trading LLC. If the trading LLC makes around $10,000 in staking income, and the C-corp gets its $4900 as a partner in the trading LLC, then can the $4900 be used to fund a 401(k) owned by the C-corp? Is the income considered earned income or ordinary income? If it is ordinary income, can it be used to fund a 401(k)?" - By doing this, putting in the structures, we kept $4900 off the personal return. That's a victory.
"I currently invest in crypto. I anticipate selling some of it sometime in 2025 with gain over a hundred thousand dollars or perhaps far greater." It's crypto. You could quadruple in a day. "What would be the best move for me right now? If I were to create my LLC, would I be taxed when I moved my crypto to the wallet for the LLC, all crypto would've been bought more than a year prior to selling? Should I create an LLC this year or wait until next? - If this was just a disregarded LLC, meaning it doesn't file its own tax return, it's basically that taxpayer, either way, when we put the money in, it's not taxable.
"How do I save taxes on flipping houses? We have three houses we are flipping in the next few months." "How can we reduce the taxable income on these properties?" - We often would put our flipping activity maybe in a C-corporation, possibly an S-corporation. Why? A lot of ways to mitigate taxes with reimbursements, corporate meetings, wages that you use to contribute to a retirement plan.
"I bought a short-term rental cabin in May of 2022 using 1031 funds. Rentals are beyond disappointing at this point. If we sell for at least $200,000 loss more than the gain on the 1031 funds, how does this play out regarding taxes?" - we may not know exactly what our loss is. Let's just assume we do have that loss. When we have losses, one thing we don't have to worry about is depreciation recapture because we have no gains.
"I have multiple LLCs. Do I have to file multiple tax returns?" - it depends on how the LLC is taxed. If it's a disregarded entity, means it doesn't file a return. If I have seven LLCs and you're doing seven different tax returns, that doesn't make a lot of sense when you could set up a single entity to own them all.
"I've had my primary residence for the past 21 years. If I rent it for three years or more and sell it, would I be taxed on the depreciation I take over those 3 years, or would it be included in the 121 exclusion?" - If it was exactly three years, then they could take advantage of that 121 if they were to sell it and maybe even 1031.
"If I have a two-level house and I live in the upper level but Airbnb on the lower level, can I deduct the depreciation repair management of the lower level? Does it need to be a legal unit and have its own address?" Same question, but what if it was a long-term rental? - Because you have rental income coming in, you will be able to take these expenses - the depreciation, repair, and management. It's just a matter of how much.
"If I am a real estate professional with over 750 hours actively acquiring properties, and I sell my other long-term rentals non-real estate investments, such as stocks, private equity, and venture capital investments, can the losses from my active or passive real estate investments offset gains on my other long term non-real estate investments?" - if you have passive income, it's passive income. If you have losses, it's passive losses. You can only use the passive losses to offset other passive income. So you may get losses trapped. We call it suspended passive activity loss rules.

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=how-to-save-taxes-when-flipping-housest&utm_medium=podcast

https://andersonadvisors.com/live-tax-and-asset-protection-workshops/

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

Schedule your FREE consultation

https://www.tiktok.com/@tobymathisesq

Why Savvy Investors Use Land Trusts for Real Estate Investments

Thu, 15 Aug 2024 05:00:00 -0300

Today Toby Mathis, Esq. speaks with Lauren Robins, Esq., a senior real estate attorney with Anderson Advisors, about helping savvy investors use land trusts in the right scenarios. Lauren explains how land trusts act as a versatile tool for investors, likening them to a ‘Swiss army knife’ due to their broad range of applications. We explore what land trusts can and can’t do, including the intricacies of trust ownership and beneficiary roles. Lauren details how land trusts can help avoid unnecessary taxes, clarify sale clauses, and offer homestead exemption benefits. We also discuss equity stripping and how land trusts serve as a protective measure for investment properties. Additionally, Lauren sheds light on the Garn-St. Germain Act and how land trusts can be utilized effectively for flips, wholesaling, and ‘subject to’ deals.

Highlights/Topics:

Land trusts - a ‘Swiss army knife’ for investments
What land trusts can and can’t do
Trust ownership, beneficiaries
How land trusts can be useful
Avoiding unnecessary taxes, sale clause confusion
Homestead exemption benefits
Equity stripping
Land trusts as protection for investment properties
The Garn-St. Germain Act
Using land trusts for flips, wholesaling, and ‘subject to’ deals
Not all investors know about this extremely useful tool
Share this episode with someone who might be interested!

Resources:

https://andersonadvisors.com/strategy-session/?utm_source=why-savvy-investors-use-land-trusts-for-real-estate-investments&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=why-savvy-investors-use-land-trusts-for-real-estate-investments&utm_medium=podcast

https://andersonadvisors.com/

https://andersonadvisors.com/podcast/

https://www.youtube.com/@TobyMathis

Schedule your FREE consultation

https://www.tiktok.com/@tobymathisesq

Starting A Charity? 8 Differences Between Public Charities and Private Foundations To Help You Decide

Thu, 08 Aug 2024 05:00:00 -0300

Today Toby Mathis, Esq. speaks with Karim Hanafy, Esq., a leading expert on non-profit law at Anderson, to explore the intricacies of starting and managing a charity, be it a public or private organization. Karim shares invaluable insights on navigating IRS regulations, the differences between public and private charities, and the implications of donations and tax deductions. The conversation delves into privacy concerns for board members and family, the challenges of fundraising for public charities, and the complexities of annual filing and reporting requirements. Karim also discusses potential tax burdens, dissolution clauses, and prohibited transactions. Tune in for expert advice on effectively starting, running, and sustaining charitable organizations.

Highlights/Topics:

Get advice from someone who knows the IRS, like Karim
Examining reasons for starting a charity
Donations and tax deductions - public vs. private
Privacy concerns - board members, family
Dealing with making donations - public vs foundation
Potential tax burdens and rates
Dissolution clauses
Fundraising can be a challenge in public charities
Annual filing and reporting requirements
Prohibited transactions
Private operating foundations - museums
Share this episode with someone who might be interested!

Resources:

https://andersonadvisors.com/ss/?utm_source=8-differences-between-public-charities-and-private-foundations&utm_medium=podcast

Email Our Team To Get Your Nonprofit Started

nonprofits@andersonadvisors.com

Start Your Nonprofit Plan in 45 Minutes For Free

https://andersonadvisors.com/nonprofit-501c3/?utm_source=8-differences-between-public-charities-and-private-foundations&utm_medium=podcast

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=8-differences-between-public-charities-and-private-foundations&utm_medium=podcast

https://andersonadvisors.com/

https://andersonadvisors.com/podcast/

Toby Mathis YouTu be

https://www.youtube.com/@TobyMathis

Can I Take A Loss On My Rental Property If I Sell It?

Tue, 06 Aug 2024 05:00:00 -0300

Today, attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., delve into listener questions including - how gains from crypto investments are classified as either ordinary income or capital gains. For property sales, we explore strategies to avoid capital gains tax, such as donating to a private foundation, and we clarify the impact of marriage timing on capital gains claims. We also cover tax implications for rental property expenses, including the timing of write-offs for losses and the criteria for short-term rental deductions. Additionally, we touch on medical reimbursements for C-corps, renovations for Airbnb setups, and backdoor Roth IRAs.
Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"What are the basic principles to keep in mind with gains derived from investing in crypto?" - gains from a “personal asset” need to be identified as ordinary income or capital gains
"Is there a legal way to sell a property through a charity to avoid a capital gain and have the charity provide us with a small monthly retirement amount?" - If you already have a private foundation, you could still do this transaction as long as you gave the property to the private foundation.
"My fiance and I purchased a property together. He is selling his property that he has owned for over 10 years. We are not married yet, but intend to get married this year. If we get married after he sells his property, can we still claim status for capital gains? He will have a significant amount of capital gains on his property. His property will sell in August, and we weren’t going to get married till October. We just want to make sure we’re okay to claim status for capital gains." - I think what we're getting at here is the 121 exclusion, if you meet the criteria.
"I purchased a duplex and we’ll list it as a short-term rental in August." I want to buy furniture and supplies and do both major and minor repairs before the listing is active. Can I write off these expenses before the Airbnb listing is active?" - Generally speaking, no, you're not going to write it off before it's active.
"I bought an investment property for $260,000. It’s only worth $200,000. If I sell it, can I take a $60,000 loss?" - If we bought it as investment, maybe it was a flip or something like that, we can take it as an ordinary loss.
"For short-term qualification, do we need to add it to Airbnb or Vrbo, or can we just rent it out to friends and family for three rentals of less than a week and still qualify for the deduction?" If yes, how do we show proof?” - there's no requirement that you specifically set up an Airbnb or VRBO, but you can’t rent to friends and family or “related parties” - that’s personal use.
"Can you reimburse medical costs if organized as a C-corp?" - Simple answer, yes, if you have a medical reimbursement plan.
"Can I make renovations to my personal residence to establish an Airbnb and write off the costs?" - yes you can, depreciated over time. It must be in service to deduct.
"What is a backdoor Roth?" - You can put it in the Roth after you pay taxes on it, if you make an income over the typical limit for Roth contributions.
"What is a good way to plan when converting a primary residence into a rental property and have a tax-wise setup for the transition? Do we sell the property to the LLC or transfer sign the loan to the LLC? How will the capital gains be treated?" - you could do either one.

Resources:

https://andersonadvisors.com/ss/?utm_source=loss-on-rental-if-i-sell-it&utm_medium=podcast

https://andersonadvisors.com/live-tax-and-asset-protection-workshops/?utm_source=loss-on-rental-if-i-sell-it&utm_medium=podcast

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

Watch Neal Bawa “Feds Broke the Bank- Is Real Estate Safe?” March 2023

https://www.tiktok.com/@tobymathisesq

2024 Real Estate Market Outlook Year-End Opportunities Revealed

Thu, 25 Jul 2024 05:00:00 -0300

In this episode, Toby Mathis of Anderson Business Advisors welcomes Neal Bawa back to the show for another eye-opening appearance. Neal is the founder and CEO of Grocapitus, a commercial real estate investment company, and CEO of MultifamilyU, an apartment investing education company.

Neal reports some jaw-dropping stats: 18 million families are priced out of homeownership due to salary versus mortgage disparities. Landlords are poised with a peak supply of 673,000 apartments in 2024, but the market will experience a shortage and price hikes in 2025-2026. The Federal Reserve's interest rate policies aim to balance inflation and affordability concerns, potentially influencing market dynamics. Investors are advised to target multifamily properties and land purchases, focusing on 5-unit properties over smaller units and considering assumable loans for strategic advantages in the current market landscape.

Highlights/Topics:

Market progress since Covid
Increases - Salaries vs. Mortgages
18 million families have been priced out of home ownership
Opportunities for landlords - supply is peaking - 673,000 apartments in 2024
2025-2026 will see extreme apartment shortages and price hikes
Interest rates and the Fed
Inflation vs. rate cuts, affordability may improve
Possible zig-zagging market price fluctuations
What should investors do “right now”?
Current advantages in the multi-family market, land purchases
Why you should be looking at 5-unit properties, not 1-4 units
Look for assumable loans
Time is your friend in today’s market

Resources:

Gro Capitus Website

https://www.grocapitus.com/

MultiFamily Website

https://multifamilyu.com/

https://www.youtube.com/watch?v=v-zObxj7NPk

Anderson Advisors on YouTube

https://andersonadvisors.com/

https://www.youtube.com/channel/UCaL-wApuVYi2Va5dWzyTYVw

https://andersonadvisors.com/podcast/

https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w

The Best Options To Save on Taxes After Selling Your First Flip

Tue, 23 Jul 2024 05:00:00 -0300

Welcome to another episode of Tax Tuesday. Today, attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., delve into listener questions around various tax and business strategy questions. Topics include the active vs. passive income classification for S-corp distributions in a physical therapy home health business, the optimal timing for cost segregation and bonus depreciation in short-term rental activities, and the tax implications of transitioning from short to long-term rentals. Other discussions delved into Opportunity Zones, S-corp taxation for owner draws, classification of employees, IRA to foundation transfers, tax-saving strategies for property flips, overlooked investor deductions, 1031 exchanges for rental properties, and the feasibility of lease options in Roth IRAs.
Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

"We are starting an S-corporation for physical therapy home health business. My wife and I will be the only shareholders. My wife will run the business and see patients. I only plan to invest into the business. We'll be a limited partner. Will my distributions from the S-corp be considered as passive income since I am not materially participating in the business?" - No. It's all going to be active income.
"If you started short-term rental activity in November 2023 when the property was purchased, can you use cost segregation and bonus depreciation in 2023, or is it still better to wait until 2024?" - more than likely, you're going to be better off in 2023.
"If I buy a house in September, use it as a short-term rental for a month until October, and then do long-term rental starting in November for the STR, short-term rental, I or my spouse will actively manage the property, can I still take the bonus depreciation in first year and offset my W-2 income?" - It's all going to look at how much time did you rent it and what was the average stay.
"If I put money into an opportunity zone and then sell after 10 years, does it all come out tax-free or just any growth? - If you've had capital gains, you sold some stock, sold some property, you have true capital gains, you can invest them in what's called an Opportunity zone fund.
"If you are an S-corporation and pay yourself a regular salary, but also take money from what Intuit calls ‘owner draw’, how is that taxed?"
"Do all employees have to be W-2 employees under an S-corp, or can they be contractors?" - the W -2, as we pointed out earlier, that's going to be subject to employment tax. All of this income is subject to income tax, whatever your bracket's at, both streams.
"Can an IRA balance be transferred to a foundation tax-free and also allow the owner a tax deduction? Can I create the foundation and operate the foundation receiving the contribution?" - there's two ways to do it. I receive the money, pay tax on it, then contribute to a charity and I would take a deduction. Or I could put up to $100,000 a year of my distributions directly into the charity and now I don't pay tax on it,
"We sold our first flip at the beginning of the year and would like to know if there is any way at this moment to save as much as possible from being taxed, i.e. invested in the next flip or something else to avoid the "loss". Also, if we have a loss for our S-corp in 2023, could we see that capital gain to be offset in 2024?" -it's easy to get these things kind of mixed up. Flips are ordinary income, not capital gains.
"What are typical operating and general expenses you've seen overlooked when investors file deductions?" - The way you avoid missing deductions is you have good bookkeeping, okay?
"Can I move into a rental house I have for 15 years? Does it still qualify for a 1031 at a later date? I assume you mean when you move into it, it says a primary residence. Does it qualify for a 121 exclusion after two years?" - if we've moved into it, I'm assuming we made it our primary residence, it's no longer in a trader business, So you lose 1031 capability. 121 is for a personal residence.
"Can you do a lease option assignment in a Roth IRA? Can you do a sandwich lease option in a Roth IRA?" - Yes and yes. if we have a true option, true sandwich leases option, my understanding is yes, you can do them.

Resources:

https://andersonadvisors.com/ss/

https://andersonadvisors.com/live-tax-and-asset-protection-workshops/

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

The Power of Using Money Twice To Invest in Real Estate Strategy

Thu, 18 Jul 2024 05:00:00 -0300

Today Clint Coons, Esq., speaks with Christian Allen and Rod Zabriskie from Money Insights about the strategic use of life insurance policies for real estate investments. Learn how to maximize your financial resources by putting money to work through optimized contributions and leveraging the tax-free advantages of life insurance. Explore the flexibility of funding ranges tailored to your goals and discover how quickly you can access funds. Understand the process of taking loans from your policy to invest and the impact of simple versus compounding interest.
Christian Allen is the founder and CEO of Money Insights. He launched Money Insights in 2014 after working in the financial services industry for over a decade. Christian’s mission is to help high-income earners accelerate their wealth building, optimize their investing, and find new and innovative ways to go from high income to high net worth! He is passionate about entrepreneurship and helping others. He enjoys playing pickleball, watching sports, and spending time with his wife and children.

Rod Zabriskie is the President of Money Insights working directly with clients and the team to create an enjoyable environment for all. He has worked in financial services since 2009, after a decade of working in small businesses for others. He holds an MBA, with an emphasis in entrepreneurship, as well as an undergraduate degree in Marketing Communications. Rod is married to Jodi, and they have 7 amazing children.

Highlights/Topics:

Don’t just save money to invest, put it to work
Utilizing the tax code, life insurance as a vehicle
Optimizing contributions to your policy
Flexibility - creating funding ranges for a policy
How soon can someone access these funds?
How to take out a loan from your insurance policy to invest
Simple v Compounding interest in this scenario
Examples of how this concept can work and ‘what if’s’
Utilize up to 95% of your policy amount - think of it as a line of credit!
Money Insights can easily help you structure these setups
Tax-free benefits
Phase two of the investment optimizer - creating tax-free income
What happens if you actually DIE?
Case study - wild client story
Contact Money Insights to get started

Resources:

Money Insights

https://moneyinsightsgroup.com/aba

https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=the-most-profitable-self-storage-investing-strategy

https://andersonadvisors.com/live-tax-and-asset-protection-workshops/

https://andersonadvisors.com/

https://andersonadvisors.com/podcast/

https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w

https://andersonadvisors.com/ss/

How To Use Your Self-Directed IRA For Real Estate Investing

Tue, 09 Jul 2024 05:00:00 -0300

Today, attorneys Toby Mathis, Esq., and Amanda Wynalda, Esq., delve into listener questions around topics like the benefits of LLCs for real estate investors, income-shifting tactics, and the implications of the Tax Cuts and Jobs Act on small business owners. The conversation also delves into the complexities of Qualified Business Income (QBI) deductions, using self-directed IRAs for real estate investments, and the tax implications of transferring appreciated property into LLCs. Submit your tax question to taxtuesday@andersonadvisors.com

Highlights/Topics:

Have you attended an in-person or virtual Tax and Asset Protection Workshops?
Anderson Advisors has done a great job of creating all the pieces of my estate, but I have no idea how to put it all together. All right, that's a great first one. In particular, how do the holding LLCs flow into my personal tax return and how does the LLC tax as a C-corp get reported on my personal returns? - if your entire structure is disregarded and you're reporting your rental properties on your Schedule E, page one, you would continue to report that exact same thing on Schedule E, page one.
Can I expense my breeding stock as a dog breeder rather than do depreciation? - They have a seven-year useful life, as “business property”
Can you please speak about QBI and how it is often missed by business owners? W-2 employees are not allowed to use it. Who else? On the one hand, S-Corps can claim 20% right away. Is this true? - C-corps are separate entities, this is geared to the small business owner
As a real estate professional, can I also take the depreciation expense from syndications?
How do I use my self-directed IRA to invest in real estate? - if you have a self-directed, then you can invest in what's considered, I guess, non-traditional types of investments, including real estate
What is the tax impact of moving an appreciated property into a LLC? - you have like four choices disregarded partnership, S-corp, C-corp. But there's no such thing as LLCs for tax purposes. So we need to know a little more information.
What are the differences between an HSA and an HRA Health? - HSA is a health savings account and an HRA is a health reimbursement account. So there's actually a number of differences.
I have been depreciating my rentals for tax purposes. How can I benefit or switch to cost segregation? - They're business property and so residential real estate is depreciated on a 271/2 year useful life and commercial is 39 years.
How should I set up my stock investing to avoid huge tax penalties? Penalties, yeah, don't worry about the penalties, it's the tax liabilities of making too much money.
Do you have to be an LLC to get all the tax benefits from purchasing investment properties? - If we're talking about all the tax benefits, probably. But you don't have to have an LLC to own rental property.

Resources:

https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=how-to-use-your-self-directed-ira-for-real-estate-investing

https://andersonadvisors.com/live-tax-and-asset-protection-workshops/

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Investing with Confidence: Kevin Simpson on Covered Calls and Elections

Mon, 08 Jul 2024 05:00:00 -0300

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:

Kevin Simpson Capital Wealth

https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=investing-with-confidence

https://capitalwealthplanning.com/team/kevin-simpson/

Book: Walk Toward Wealth

https://www.kevinsimpson.com/walk-toward-wealth/

https://andersonadvisors.com/

https://andersonadvisors.com/live-tax-and-asset-protection-workshops/

https://www.youtube.com/c/tobymathisesq

The Main Tax Differences Between An S-Corporation and C-Corporation

Wed, 26 Jun 2024 05:00:00 -0300

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:

https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=the-main-tax-differences-between-an-s-corporation-and-c-corporation

https://andersonadvisors.com/live-tax-and-asset-protection-workshops/

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

The Most Profitable Self-Storage Investing Strategy

Tue, 25 Jun 2024 05:00:00 -0300

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:

Spartan Investment Group

How to Avoid Paying Capital Gains Tax on Inheritance

Tue, 11 Jun 2024 05:00:00 -0300

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:

Bookkeeping Services from Anderson

https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=how-to-avoid-paying-capital-gains-tax-on-inheritance

https://bookkeeping.andersonadvisors.com/

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How Do I Pay Myself From My LLC Taxed As A Partnership?

Wed, 29 May 2024 05:00:00 -0300

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:

https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=how-do-i-pay-myself-from-my-llc-taxed-as-a-partnership

Scott Estill, Esq.

https://scottestill.com/

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

The Ultimate Banking Solution for Small Businesses & Real Estate Investors

Tue, 21 May 2024 05:00:00 -0300

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.

How To Choose The Best Entity For Flipping Real Estate

Tue, 14 May 2024 05:00:00 -0300

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:

https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=how-to-choose-the-best-entity-for-flipping-real-estate

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

Request a coverage proposal NREIG

https://www.youtube.com/@ClintCoons

Why Landlord Insurance Is Vital for Real Estate Investors

Thu, 02 May 2024 05:00:00 -0300

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:

https://affiliate.nreig.com/Anderson

Shawn Woedl LinkedIn

https://www.linkedin.com/in/shawnwoedl/

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

How Can A 1099 Contractor Reduce Taxable Income?

Tue, 30 Apr 2024 05:00:00 -0300

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:

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

Get Your Free Emergency Binder

https://www.youtube.com/@ClintCoons

What Is The Best Tax Efficient Way To Purchase An Existing Business?

Tue, 16 Apr 2024 05:00:00 -0300

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:

https://andersonadvisors.com/emergency-binder/

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

Schedule Your FREE Strategy Session

https://www.youtube.com/@ClintCoons

How to Structure Your Real Estate Flipping

Thu, 11 Apr 2024 05:00:00 -0300

In this episode, Toby Mathis, Esq. chats with Jeffrey Cottle, Esq., Senior Attorney at Anderson Business Advisors, about the world of house flipping, with a focus on how to handle the tax implications. It emphasizes the importance of avoiding "dealer" status with the IRS and explores strategies like asset protection. Toby and Jeff discuss limitations placed on frequent flippers and analyze the pros and cons of different business structures like LLCs, C-Corps, and S-Corps. It concludes by examining the most common scenarios Jeff encounters at Anderson Advisors when working with house flippers.

Highlights/Topics:

Jeff Cottle intro
Flipping all comes down to ‘intent’ with the IRS
Avoid “dealer” status, and consider asset protection when flipping
1031 exchanges, installment sales are not available to dealers
Flipping risks increase with each new property you purchase
Pros and cons to LLCs, C-Corps, S-Corps
What is the “typical” scenario Jeff sees for flippers?
Send us your questions and ideas for future show topics!

Resources:

https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=how-to-structure-your-real-estate-flipping

Jeffrey Cottle LinkedIn

https://www.linkedin.com/in/jeffrey-cottle-019a75a2/

https://andersonadvisors.com/

https://www.youtube.com/c/tobymathisesq

Can I Contribute To My Health Savings Account After Leaving My Employer?

Tue, 02 Apr 2024 05:00:00 -0300

In this episode, Toby Mathis, Esq., and Eliot Thomas, Esq., bring more of their tax knowledge to the masses, answering questions on HSA contributions, employing your children in your business, and keeping your assets in a self-directed IRA. Be sure to check out our FREE virtual events happening this month. Submit your tax question to taxtuesday@andersonadvisors.

Highlights/Topics:

"For an LLC that opted to be taxed as an escort is it better to not just. the profits and let retained earnings grow on the balance sheet and invest retained earnings in stocks or other investments in the name of the LLC? - the profits are automatically going to come down to hit your return. You're going to have to pay tax on those
"I am considering signing up with Anderson and contemplating having you amend the last three years as I don't think my CPAs or TurboTax gave me all the write-offs that I was eligible for as a real estate investor.I think I may qualify for a greater return, but also don't want to automatically trigger an audit. - the “triggering an audit” that's, I think, a really common scare tactic that's out there…amending is not going to create an audit.
"Can I continue funding an HSA account if I am no longer employed by the company that offered it but still have the account? Does it make sense to place it into a HSA investment account? - You certainly can continue with that HSA. Even if it's an employer-sponsored HSA, it is the employee's property, should they choose to leave.
"I have a K1 that will be late from the sale of an apartment complex in Georgia. I am a married filing separately tax payer. I will do an extension but still have to pay tax in April How do I know how much to pay without the K1? I Went through a similar sale last tax season and had to pay a late fee due to the late K-1. I'd like to avoid that again.- There is a safe harbor. If you've paid in at least 90 % of what will be due during your time period before April 15th,
"What are the benefits of having children as employees? Are there education expenses eligible for payment by the company? - if kids are paid underneath the standard deduction for that particular year, then there's no federal income tax on it. There are many benefits to shifting income to your children.
"If we live in our rental house for two of the prior five years to avoid full taxation on capital gain, take advantage of the $500,000 exemption for married joint-filing, can the remaining amount that we, remaining amount we will pay in taxes be offset? Can the remaining amount we will pay in taxes be offset by losses in our other rental properties? Capital if we qualify as real estate professionals during the year for filing. For example, if we purchase another property, and cost seg it, can those potential deductions be used to offset the taxes paid on the primary residence sale? - As long as they're in there for two of the last five years, they are eligible for ownership and use.
"How long do I need to have a property in service to rent to be able to deduct bonus depreciation from a cost segregation study? - you want to be reasonable, probably a reasonable amount of time, but if it was available for rent. That's it!
"My asset is in a self-directed IRA, so when you see SDR at IRA, that means self-directed. I am assuming if I sell it, the money is considered income and I'm taxed on it like any other income. Also, if I use the money from the sale of that property for the purchase of a different property, not kept in the self-directed IRA, can I avoid taxes? What is your suggestion in this type of situation? - there's a whole lot of misconception going on in this question. So no, we are not taxed on it like any other income. It's quite the opposite.
"Just started an ink taxes as C Corp What is an accountable plan? Is it something I need to join before I can get the benefit of it? Can any reimbursement be an expense with my personal name and get reimbursement like health dental vision cell phone, etc Do I need to have my cell phone account in the business name? - an accountable plan just means reimbursement. It's a fancy IRS term.
"Does the assignment of beneficial interest in a land trust count as an installment sale for tax purposes? Who's responsible for the property taxes in such a transaction? - another one with some misunderstanding here.

Resources:

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=can-i-contribute-to-my-health-savings-account-after-leaving-my-employer

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Email Our Team To Get Your Nonprofit Started

https://www.youtube.com/@ClintCoons

The Top 10 Types of Nonprofits You Can Set Up

Thu, 21 Mar 2024 05:00:00 -0300

Today Toby Mathis, Esq. speaks with Karim Hanafy, Esq., Anderson’s non-profit expert, about the top ten types of non-profits you can form to access tax benefits for your charitable activities. These range from familiar causes like humanitarian aid (both domestic and international) to education (including scholarships) and even combating social issues through activities and therapy animals. Research, veteran/elderly assistance, and various housing needs rank high, as well as animal welfare, environmental causes, and empowering communities. Finally, the importance of supporting other nonprofits, regardless of their specific cause, is also an option.

Highlights/Topics:

Karim’s background/expertise in non-profits
Top ten types of nonprofits
Humanitarian relief - domestic/international - food, clothing, shelter, medical care, housing
Education and scholarships- trade schools etc.
Activities to combat obesity, depression, and isolation - social and outdoor activities, therapeutic animals
Research - medical and financial support
Assistance for veterans and the elderly- medical, counseling, jobs, housing
Housing - this used to be number one - recovery from abuse, elderly, vets, under-resourced
Animals - sanctuaries, animal therapy programs
Miscellaneous - pollution, ministries, waste reduction, empowering the underserved, disaster relief
International giving - orphanages, food, clothing, shelter, animal sanctuaries, clean water
Supporting any of the above activities, or supporting other organizations that provide the previous support

Resources:

Schedule Your Free Strategy Session

How To Write Off Travel Expenses

Tue, 19 Mar 2024 05:00:00 -0300

Welcome to episode #214 of the Anderson Business Advisors podcast. Today, experts Toby Mathis, Esq., and Eliot Thomas, Esq., explain tax strategies for common questions concerning how to write off business travel that includes personal days (hint: business days have to be more than 50% of your trip), how and when you can qualify as a real estate professional, investing in real estate from your investment accounts, and some of the helpful tax benefits of creating and using a Health Savings Account.
Submit your tax question to taxtuesday@andersonadvisors.
Highlights/Topics:

"Can I deduct travel expenses to rehab rent rentals that are in other states than my primary residence?" - Yes, but you have to spend more days doing work (more than 50%) than personal days.
"If we convert our traditional IRA to a Roth IRA with the same provider, do we have to file any forms with the tax return or otherwise? If so, what forms?" - You’ll receive a 1099R - the converted amount is taxable.
"Do we have to make the REPS election every year? And how do we make the election?" – That's real estate professional status. Does one spouse qualify? Is he/she spending 750+ hours on the business?
"Last year we neglected to register as real estate professionals. We ended up owing a substantial amount in taxes. Can we register as real estate professionals this year and carry over the expenses that were disallowed for 2022 and 2023?" –in '23, if we make the status and we, the real estate professional status and we aggregated, we got everything done properly in return, it's not gonna help us. for those prior losses.
"For Augusta rule payments, what documentation is required beyond meeting minutes? Do I just write myself a check? Should Augusta rule go in the memo? Do I need to send myself an invoice? I am the owner and employee of an S-corporation?" – You always want to send an invoice. I would recommend it. You want to have that paper trail.
"Can investment income be used to fund a health savings account? The deductibles are so high. We are always paying out of pocket." - So you don't need any type of specific income to fund an HSA health savings account. Limits for 2023 are 7750 for a family, 3850 for an individual.
"I plan to buy a rental property using my 401(k). I'm 65 and set up my solo 401(k) for rollover. My question is, if I convert to a Roth 401(k) and purchase the rental, does the rental income and future equity gain become tax-free?" – Yes, it does, that's a quick answer.
"Should I have my rental income funneled into an LLC, business, or corporation to save money in taxes?" - how is it taxed? And it can be what we call disregarded, which means it's taxed. Could be a partnership, could be an S corp, could be a C corporation, and all those have different answers.
"What are the tax and legal benefits of making an owner loan to my LLC rather than capital contributions?" - just like the last question, how is that LLC taxed? We would do something different, perhaps if it was a disregarded entity or partnership versus an S -corp or a C -corp. They can all have different outcomes depending on how we do it.
"Can you write off 100% of your trip to Las Vegas all expenses? I'm a realtor licensed in both Nevada and California. Any other tax deductions?" - You're going to have to qualify it as business travel. That means more days of business than anything else…

Resources:

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=write-off-travel-expenses

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Email John Anderson for a consult

https://www.youtube.com/@ClintCoons

How to Form a Nevada Asset Protection Trust

Thu, 14 Mar 2024 05:00:00 -0300

In this episode, Toby Mathis, Esq. chats with fellow attorney John Anderson, Esq. of Anderson Business Advisors about the pros and cons of establishing trusts in Nevada. The discussion digs into Nevada trusts' specific functions and benefits, including the "seasoning period" and the role of trustees. Toby and John explore how a third-party trustee can offer protection, methods for withdrawing funds, and the power of appointment in Nevada trusts. Additionally, they touch upon safeguarding your home with a trust, using a trust for essential expenses, and the potential risks of insolvency and bankruptcy. The conversation highlights the likelihood of lawsuits settling against a Nevada trust while acknowledging the absence of tax advantages.

Highlights/Topics:

Trusts - to revocable or irrevocable?
Advantages to setting up trusts in Nevada and South Dakota
The “seasoning” period
Trustees and their functions in these states
Protection through a third-party trustee
Filing taxes and withdrawing money - Nevada trusts
Power of appointment
Protecting your home with a Nevada trust
Using an asset protection trust to pay for essentials
Risks of voluntary insolvency and bankruptcy
Most lawsuits will choose to settle against a Nevada trust
Tax advantages - there aren’t many
Pro-rata vs. non-pro-rata
A high-profile divorce case with a Nevada trust, and the outcome
Not subject to the Corporate Transparency Act
Setting up a Nevada trust, statute of limitations

Resources:

estateplanning@andersonadvisors.com

Anderson Advisors on YouTube

https://andersonadvisors.com/

https://www.youtube.com/channel/UCaL-wApuVYi2Va5dWzyTYVw

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=how-to-form-a-nevada-asset-protection-trust

https://www.youtube.com/c/tobymathisesq

https://andersonadvisors.com/

How To Wholesale Real Estate (Best Structure & Asset Protection!)

Tue, 12 Mar 2024 05:00:00 -0300

Clint Coons, Esq. and Greg Helbeck from Velocity Home Buyers tear down the facade that wholesaling is a no-risk investment, exposing the legal snares and fiscal sinkholes that might just catch you off-guard. Hear about Greg's near-miss disaster when a contracted property burned to the ground, a story that underscores the need for bulletproof business strategies to safeguard your ventures against the unpredictable foibles of real estate.
Lastly, we traverse the digital landscape of virtual real estate, covering the essentials for managing sales and renovations without once stepping foot on the property. There's a treasure trove of insights on direct mail marketing too, proving the worth of printed marketing in a world enamored with digital solutions. Whether you're looking to hone your marketing tactics or fine-tune your remote investment strategies, this episode is a vault of expertise for any wholesaler eager to secure a fortune in the ever-evolving real estate market.

Highlights/Topics:

What is wholesaling and why is it so appealing?
Greg’s hair-raising wholesale tale of woe
Structuring deals through an LLC
Other risks in real estate contracts
Wholesaling across state lines
Motivation behind seller's decision
Direct mail marketing strategies for success
Success through uncomfortable actions

Resources:

Greg on IG

https://www.instagram.com/grego_37/

Velocity House Buyers

https://www.velocityhousebuyers.com/

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=how-to-wholesale-real-estate

https://andersonadvisors.com/

https://andersonadvisors.com/podcast/

Podcast - Rich Doc Poor Doc

https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w

Investing In CASHFLOWING RENTALS (How To Get Started)

Thu, 07 Mar 2024 05:00:00 -0400

Clint Coons, Esq. speaks with Kenji and Letizia Alto, who are both MDs and founders of Semi-Retired MD. They share their journey from being high-income physicians to achieving financial freedom through real estate investing. The episode delves into the mindset shifts required to excel in the property market, overcoming common obstacles, and utilizing strategic tax benefits. The couple also introduces their new fable-like book, contrasting the financial paths of two couples. You’ll hear about building a strong investment team, identifying hidden equity, and leveraging techniques like cash-out refinancing and 1031 exchanges to maximize returns and accelerate the journey toward financial independence.

Highlights/Topics:

Kenji and Leti's journey from physicians to real estate investors
Mindset shifts essential for real estate success and tax reduction
Introduction to Kenji and Leti's book
Overcoming fears and hurdles in out-of-state multifamily investments
Building a strong team for informed decision-making in real estate
Hidden equity and trusting instincts for better returns
Real estate for significant tax benefits and wealth growth
Profiting from real estate through various streams like cash flow
“Lazy equity” via cash-out refinancing and 1031 exchanges
Fast FIRE concept for accelerated financial independence
Resources for high-income earners

Resources:

Book: Life on Your Terms

https://www.amazon.com/Life-Your-Terms-Investments-Themselves/dp/154453096X

https://podcasts.apple.com/us/podcast/rich-doc-poor-doc/id1506849313

Semi Retired MD FB

https://www.facebook.com/semiretiredmd/

Semi Retired YT

https://www.youtube.com/channel/UCibjmeDUNn568Egl5TppnPg

Semi Retired IG

https://www.instagram.com/semiretiredmd/?hl=en

Semi Retired Website

https://semiretiredmd.com/

Semi-Retired MD LinkedIn

https://www.linkedin.com/company/semi-retired-md/

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=investing-in-cashflowing-rentals

https://andersonadvisors.com/

https://andersonadvisors.com/podcast/

Free Emergency Estate Planning Kit

https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w

How To Report Income From A Short-Term Rental Property

Tue, 05 Mar 2024 05:00:00 -0400

Today, experts Toby Mathis, Esq., and Elliot Thomas, Esq., explain valuable tax strategies for real estate investors, traders, and various income earners. You’ll hear about the optimal tax classifications for short-term rentals, using retirement funds for real estate investment, and the transition from W-2 to 1099 income for tax benefits. Additionally, Eliot and Toby discuss maximizing deductions through trading partnerships, the benefits of Health Savings Accounts, vehicle write-offs, and home office deductions. Submit your tax question to taxtuesday@andersonadvisors.

Highlights/Topics:

Is short -term Airbnb and VRBO (short term rentals) under Schedule C or Schedule E? - if it’s just bare oversight management, etc. That might put it on Schedule E. Schedule C is if you have more substantive activity you're putting into it.
I was told I could use my company assets of 401k to loan money to buy real estate investment. Is that true? If so, how? - its true, one is allowed to take a loan out by law, if your plan allows for it. If you don’t pay it back it becomes taxable income.
How how can I position my child's college tuition as a business expense? - let's say your child's handling the bookkeeping for your corporation, and they're taking accounting classes, then you can deduct the classes related to what that child's already doing in the corporation.
What percentage of gains do I need to pay tax on if I trade for it, if I trade forex and if I put money into a holding LLC? Can I minimize it? - often it's gonna be section 1256, and You get a treat 60% as a long-term capital gain, and the other 40% is gonna be short-term capital gains, which means you're at your ordinary tax bracket rates.
How do I deduct expenses if I have a W2 and a 1099? - generally speaking, on a W-2, there's nothing you can deduct business-wise against. If you had expenses that you incurred in order to get your W-2 income, they took that section away with the Tax Cut and Jobs Act back in 17.
I just started my small business of being a mortgage broker. I own a single family rental about an hour from my house. Can I take a tax deduction for mileage expenses if I use my vehicle for both businesses? What about taking deduction on one car for mortgage and take deductions on the other car for the rental property? - We're going to recommend your vehicles be titled in your personal name. Usually we're going to deduct that mileage.
If I purchased a property to rent it and I have it as an Airbnb and I did a lot of work in 2023, can I claim all the expenses for 2023 tax year, even if the house was not rented at all in 2023 because of work is estimated to be complete in quarter one of 2024. - You can in 2024, but we can't go back to ‘23, when the expenses were incurred, because it wasn't placed in service yet.
Can I make charitable contributions from my business LLC income and take it as a business tax deduction? Due to the standard deduction, I can't deduct them from my personal return. - If it's a C corporation, then the C corporation can deduct up to 10% of its net income. Used to be 25% during the CARES Act but they've moved it back to the traditional 10% of your net income
Started regular 15-year depreciation for capital improvement of rental property in 2021, didn't know any better. I switched to bonus depreciation and claimed the remaining amount in 2023. Are any home improvement projects tax deductible? - At its base level, no. But if you happen to have a home office, and you have a C corporation or an S corporation, then any your home improvement projects, yes, they will be deductible in the sense that if it's directly related to the office

Resources:

https://aba.link/nzj

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=how-to-report-income-from-a-short-term-rental-property

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

Profit First and Beyond: Mike Michalowicz Unveils 'All In' Strategies and Success Stories

Thu, 22 Feb 2024 05:00:00 -0400

Have you ever wondered how flipping the script on profit can revolutionize your business? Mike Michalowicz joins Toby Mathis, Esq., to dissect his innovative 'Profit First' formula, a game-changer for entrepreneurs swimming against the tide of traditional financial management. Mike, the sage behind several seminal business books, engages in a no-holds-barred discussion about the essentials of a prospering business—prioritizing profit, pinpointing pressing needs, and strategies for organic growth. You’ll also hear the details of Toby’s own multi-million-dollar tumble and the invaluable lessons that journey taught me, all of which dovetail with Mike's profound insights.

Highlights/Topics:

Mike intro and background
Books by the guest and their basic message
Past failures, “face plants,” losing millions
Competitive advantages in today’s market
Camps in the sports industry - employers should take note
Home Depot’s employment recruiting ‘camps’
Examples of offering education for recruitment
What is ‘collective psychological ownership’?
Using these techniques as an employee
Company culture- diversity builds community

Resources:

All In by Mike

https://allinbymike.com/

Mike Michalowicz Bio

https://mikemichalowicz.com/bio/

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=profit-first-and-beyond

https://www.youtube.com/c/tobymathisesq

Request a Free Cost Segregation Study

https://andersonadvisors.com/

Are Educational Courses Tax Deductible?

Wed, 21 Feb 2024 05:00:00 -0400

This episode of Tax Tuesday, Toby Mathis, Esq., and Eliot Thomas, Esq., cover topics including paying your children from your business, when you can write off meals as “business” - (hint: it all comes down to ‘intent’), and how often you should meet with your CPA. Submit your tax question to taxtuesday@andersonadvisors.

Highlights/Topics:

"Does my S-corporation where I am the sole owner and sole employee have to issue a 1099 to me as an individual?" - In general, you're S-corporation, you're an employee, so you would get a W-2. It's what we call reasonable income.
"If my husband and I, both shareholders of our C-corp, discuss business over dinner, are we able to be reimbursed for our meals? Is there a list of reimbursable expenses for employees/owners of C-corps that is easier to read than the tax code?" - If the intent was to talk about business, then generally speaking, you can deduct it
"Can I sell my solo 401(k) held property, do a 1031 into another investment, and then buy the property back with an LLC?" - first of all, we wouldn't have a 1031 going on with a solo 401(k). We don't have deductions, we just have cash in cash out with our retirement plans.
"How are taxes handled differently with capital assets versus repairs, maintenance, and labor of rental properties?" - Every time you lay out cash for one of these repairs or labor, that's going to be an immediate deduction for the full amount.
"How do I get tax benefits from paying my children for doing work in the business?" - basically you can just pay them out whatever entity you have.
"Are the costs of education specifically related to starting a business deductible, specifically paid webinars or courses taken online. I've read that they are, but apparently many say they are not. Is there some special way to categorize them so that they are deductible?" – If its in a C-corporation or an LLC taxed as a C-corp, we're allowed to deduct the training as training our employees, which you would be an employee of.
"I recently purchased a small camper trailer to rent out, my camper rental side hustle per se. "Does this type of rental count as an STR, short term rental, as far as taxes are concerned? Some suggest filing Schedule C while others say Schedule E might be more appropriate. We are not going to use this camper personally. It is for rentals." - If you rent it for 14 days or less, you don't have to report it. It's covered under 280A subsection G2. If you rent it for more than 14 days, it is an investment property.
"If I put my rental properties into an LLC, do I have to file both personal taxes and business taxes?" - how is that LLC taxed? It can be a sole proprietorship. It can be a partnership if we had another member, two or more members. It could be an S-corp, could be a C-corp. All those make a difference.
"How often should I be meeting with my CPA a year?" - I'm going to really recommend having quarterly meetings with your CPA just to make sure everything's on track.
"Can I file my taxes for my LLC as a corporation to get a lower tax percentage? I run short term rentals. I host short term rentals for other owners. I also run short term rentals in the properties I own. I have an S-corp with my husband and I work from home. My accountant said, I cannot deduct my home office expens - we never want to put appreciable real estate into a corporation, S or C, if we're holding onto it for a long time.
"Can someone file their taxes through your company?" - Yes, you can. You have to be a tax client

Resources:

https://andersonadvisors.com/CSA/

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=are-educational-courses-tax-deductible

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Request a Free Cost Segregation Study

https://www.youtube.com/@ClintCoons

Are Gifts To Clients And Employees Tax Deductible?

Tue, 06 Feb 2024 05:00:00 -0400

This episode of Tax Tuesday with Toby and Eliot is brimming with strategies to supercharge your financial savvy. From unlocking the mysteries of deductions and depreciation to turning real estate activities into a tax-saving powerhouse, we dissect the fine print of the tax code and transform it into actionable advice. The episode covers various topics including handling missed 1099 deadlines, gifting to clients and its tax implications, maximizing deductions, the benefits of cost segregation studies, combining short and long-term rentals for tax advantages, and the intricacies of aircraft depreciation for a flight instructing business. Remember, knowledge is power, especially when it comes to dealing with Uncle Sam. Submit your tax question to taxtuesday@andersonadvisors.

Highlights/Topics:

Do I have to get a 1099 to every sub who worked on a single family home we are rehabbing? Do I have to send a 1099 to them? And if we do have to get 1099s to parties, I'm assuming we have to get a W-9 from them first? - the duty to send a 1099 is when you pay $600 or more to a contractor.
Hi, I am new to setting up a business for real estate investing. My taxes will be startup and training fees. At what percent can I expect there to be write-offs to the business? – If it's a business expense, you'll be able to deduct 100% of that expense.
I hadn't claimed depreciation in earlier years, thinking that I wouldn't have to have my basis reduced in the future sale. Is there a way to claim those earlier years that it hadn't been taken, or did my 27 years just begin when I started taking it? - form 3115 can catch all that depreciation back up.
Is it too late to do a tax seg on a previously purchased rental property for tax year 2023? And what would be the advantages of doing it for 2023 versus 2024? - It can be done all the way up to the time your return is due the next year with extension.
How can I use real estate profits to pay for kids’ college without paying taxes? - If it's in an entity, an LLC, just pay them directly from that business.
Are gifts to clients, vendors, employees, and members tax deductible,” “If yes, what is the threshold that we can spend on gifts? - it's such a horrible rule. People really don't believe me when I say it's a $25 limit, and yet that's what it is.
My tax preparer died a few years ago." "I have not been able to find someone to help me with my taxes. Can I file 2023 before I file 2021 and 2022? Or do I have to file their tax returns in order? - There's no rule out there that you have to do this return or that return.
Can you aggregate short-term rentals and long-term rentals together in your portfolio to meet material participation requirements for REPS? - as they are, no, they're two different things. A short-term rental is a different type of business. It's actually not a rental activity, it's just a trade or business.
Our LLC installed a $84,000 solar system on a rental property in 2023. Can we take the 30% energy tax credit and deduct the entire 59,976 basis? 84,000 minus 50% of the 30% in 2023 using bonus depreciation. - Quick answer, yes. I did check, $25,200 is correct at 30%
Started a small flight instructing business in 2023 and purchased a plane in 1223 Finance. What depreciation options are there, and what would be the best approach if the income stream will not begin until 6/24? - It'd be a 2023 asset, and you can do the bonus depreciation we've talked about.

Resources:

https://andersonadvisors.com/CSA/

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=are-gifts-to-clients-and-employees-tax-deductible

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

https://www.youtube.com/@ClintCoons

How to Structure a Residential Assisted Living Business

Tue, 23 Jan 2024 05:00:00 -0400

Welcome back to another engaging session of Tax Tuesday from Anderson Business Advisors, where your pressing tax queries meet expert insights! In this episode, host Toby Mathis, Esq., welcomes regular guest Eliot Thomas, Esq., Manager of Tax Advisors at Anderson Business Advisors. This week, we explore the benefits of strategic corporate partnerships in investments, the allure of residential assisted living businesses, and the unique tax considerations for collectibles like wine. Submit your tax question to taxtuesday@andersonadvisors.

Highlights/Topics:

If I purchase a vehicle in 2023, primarily for my business, is there a percentage I have to use for business versus per personal to deduct the amount I paid for I paid cash. and how will that affect other depreciation and such for my business? I guess I'm asking what is the best way to deduct this? -the better solution for our clients is often using just a standard mileage reimbursement and that or deduction in the case of a sole proprietorship.
With bonus depreciation being reduced to 40% next year and 20% the year after that, then ending in 2027, what are the alternatives for investors who have been using bonus depreciation through real estate purchases to reduce taxable income? - the first step before you get there is you're doing cost segregation.
I have an LLC C Corp with an accountable plan including medical reimbursements good. I have a high deductible insurance plan and an HSA better. Would it make sense to use the medical reimbursement from the C Corp for uncovered medical expenses instead of paying With the HSA, letting the HSA continue to grow? - So the simple, direct answer is yes and yes, you can do that. You can have the medical reimbursement and an HSA.
I have owned a residence for 10 years. I lived in it for the first year and then rented it out. We have recently moved back into it and want to live there for at least two years so as not to pay tax when we sell it. I will potentially profit about 350,000 and am married. Is this a wise action of 76 years old? I plan on moving into our other rental at that time and perhaps selling it after two years there. - Remember you did rent it out for nine years. You had depreciation and if you didn't take depreciation you will be treated by the tax code as if you did.
I am a real estate professional and bought many real estate homes the rental homes from 2018 to 2022. My account and encouraged me not to use my real estate professional status to depreciate faster. Now I regret it. Should I just do amended returns? I paid a lot of taxes that I could have avoided in those years. - There's a form 3115 and that has to be done on a timely file original return. So we can't amend and go back and do that. But what we can do is go back and look at the related cost segregations
I have a partnership set up with my stock trading management company. Does it still make sense to distribute income to my trading management company, structured as a C-corp, for taxes if most of my trading gains this year will actually be long-term capital gains and therefore would actually be taxed at a lower rate than the corporate rate? - we don't know specifically with your situation, but more than likely there's still benefit to doing so.
How do you determine the best structure for a residential assisted living business that will be located in Florida and Georgia, buying the home and running it to the business? –if we had the business and it owned the home, you always run the risk of having someone like me being in that business and I sue you and I take the whole thing. I take the house and the business. So we separate.
What are the tax implications of investing in wine? This is for clint. Yeah, that's going to say it doesn't count if you drink at all. Right, all right. For example, like using a platform like vino vest, I made 20-something percent last year in my whiskey, yes, and I don't even drink much. Is One able to write off losses from the sale of wine or offset these losses against taxes owed? Any sort of tax loss harvesting way interesting. - this is a 28% bracket and it's called collectibles. This is gonna be your art, your fine alcohols and things like that, and so there actually is a unique category of capital gains for this…
Is there a difference between filing taxes with an October deadline Versus an April deadline? If yes, what are the advantages or disadvantages of each? -we are always gonna recommend that you extend, and that would extend your April deadline out to October. Gives you more time to clearly see what's going on and it gives you more time to get all things properly put into place.

Resources:

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=how-to-structure-a-residential-assisted-living-business

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis

https://www.tiktok.com/@tobymathisesq

Learn Next Level Passive Income Strategies Through Real Estate Investing

https://www.youtube.com/@ClintCoons

How Do Offshore Corporations and Trusts Work in the US

Tue, 16 Jan 2024 05:00:00 -0400

Join Toby Mathis, Esq., as he speaks with international tax expert Jimmy Sexton, LLM., the Founder & CEO of Esquire Group, about unraveling the enigma of offshore banking and its impact on US taxpayers. Despite popular belief, Jimmy reveals that the era of offshore banking providing substantial tax benefits is over, with the true perks lying elsewhere such as asset protection and market access. We navigate through the murky waters of tax evasion myths and scrutinize how various income structures, including disregarded and taxable entities, bear on one's tax obligations. Moreover, Jimmy illuminates the effects of the GILTI and Subpart F tax regimes on foreign company profits, stressing the importance of understanding the intricate US tax code to avoid hefty penalties and ensure compliance.

Highlights/Topics:

Offshore banking myths vs. reality for US taxpayers
Tax advantages from asset protection, not tax savings
Misconceptions about offshore tax evasion
Implications of GILTI and Subpart F tax regimes
Complexities of international business operations
Benefits of Foreign-Derived Intangible Income (FDII)
Major corporations adapting to tax law changes- Google and Amazon
Tax reforms encourage repatriation and competitiveness
Severe penalties for non-compliance with FBAR regulations
Compliance demands of offshore structures versus domestic
Corporate Transparency Act and international standards

Resources:

Esquire Group

http://www.esquiregroup.com/

Email the Esquire Group

info@esquiregroup.com

Call the Esquire Team: UAE: +971 4 517 8458 | US: +1 480 525 4829

https://infinityinvesting.com/infinity-investing-workshops/

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=how-do-offshore-corporations-and-trusts-work-in-the-us

https://www.youtube.com/c/tobymathisesq

https://andersonadvisors.com/

When Are Crypto Earnings Taxed?

Tue, 09 Jan 2024 05:00:00 -0400

Ever wonder how cryptocurrencies and real estate investments play together in the sandbox of taxation? Or how to pay your family members through your business in a way that could benefit everyone's wallet? We've got answers to these questions and more. Welcome to another episode of Tax Tuesday, where tax experts Toby Mathis, Esq., and returning guest Jeff Webb, CPA, and CFO of Anderson Business Advisors share their expert advice. This episode delves into the nuances of crypto transactions and the impact on your tax bill, along with a deep dive into payroll complexities that could save you a headache—or better yet, a hefty fine. Plus, we discuss why paying children through your business isn't just a clever maneuver; it's a strategic move that could pave the way to a tax-free goldmine.

Submit your tax question to taxtuesday@andersonadvisors, and check out our new “knowledge room” available to Platinum members, from 9a-2p daily.

Highlights/Topics:

I owned a condo for the last 28 years and depreciated it down to zero. In January this year I sold the condo to the renter and installment sale. For the next 10 years, I'll receive monthly payments, with a balloon payment at the end of 10 years. My question is as follows Do I have to recapture the depreciation and pay tax on it? Am I too late to do a 1031 exchange at this time? - If you’ve already sold it, it’s too late. 1031s do not work well with installment plans.
What would be the best way to sell a small business and limit as much as possible the tax implications? - a stock sale is best, but almost no one will go for that….
When are crypto earnings taxed?- When you sell it, you pay capital gains tax on the difference between your buy and sell.
What activities classify for the 750 hours? Does training, traveling, searching for properties? - It's going to be real estate activities in your real estate business. Training, traveling, and searching for properties is “investor” activity
I self-manage a single short-term rental that I own. I want to pay my kid, who is 16 years old, for doing legit work for the Airbnb at a reasonable rate. Do I just write them a check every month based on the hours they log, or do I have to hire a payroll company to issue them a check? I do not have any other employees. If I don't hire a payroll company, how do I issue them a W2 form? - you really should hire a payroll company, if you 1099 them, they will have to pay tax.
I'm planning to start lending money to real estate investors. Other private money lenders I know do their lending businesses through an S-Corp. I currently don't have an LLC or an S-Corp for lending. I have a Wyoming Hold LLC that I opened to use for real estate investing. Which would you advise is best for private money lender an LLC, an S-Corp, any other, and why? - Do not do it through your Wyoming LLC. I like the S corporation rather than the LLC…
I have a 50-50 partnership with a friend and we own two short-term rentals together. Each of us is maturely participating in one short-term rental each. Is there a way to take full cost-seg advantage against our respective W-2s or can we only take 50% of one property against your W-2 and the other person? It will go to the passive bucket and vice versa for the other property. - Couldn't we both get that deduction? Yeah, you probably could if we go back to the aspect that it's a trade or business
I am a W-2 earner. Can I save taxes if I buy a long-term rental? - Probably not. Probably not at this time. Unless you’re a real estate agent.
I'm getting a lot of pushback against cost segregation from my accountants. They say that it could trigger personal property issues in Maryland and that the cost of the study is prohibitive. - So what? The personal property taxes and most states is based on The Advalorium they call it. It's based on the current value. They usually have depreciation schedules of their own and it's not that much property tax.

Resources:

Infinity Investing

https://infinityinvesting.com/

Email us at Tax Tuesday

taxtuesday@andersonadvisors.com

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=when-are-crypto-earnings-taxed

https://andersonadvisors.com/

https://www.youtube.com/@TobyMathis