CPA
Hi everybody, I hope you guys can help me.
I'm a new REI and I'm assembling my team, but I was wondering if you live in NY and want to invest in another state do you have to get a local CPA in GA or NY? Also, if the answer is in Georgia, can you recommend me a good CPA?
Thank you in advance.
Hi Luis,
This is a very good question. Being a CPA myself, I would say it depends (I know that's what we always say).
However, I will try to walk through an example for you. I'm assuming you will still be living in NY so for your personal taxes you will be filing as a NY resident. Let's say you form a LLC (taxed as a partnership - which is the most common election for LLCs) in GA, technically a LLC can be created in any state but for this example you form the LLC in GA. The LLC will be filing a tax return and you will be getting a K-1 from the LLC with income sourced to GA. Because of this you will have to file a non-resident GA state return for you personally (some states do not have personal income taxes but GA does) and depending on your taxable numbers may have to pay income taxes in GA (or if it is a loss, you may still want to file in GA to carry-forward taxable losses to offset against the eventual taxable income if the state allows it).
The beauty of being a CPA is that we have reciprocity across the whole US (unlike attorneys who may have to get licensed in multiple states). This means your current CPA can assist you. They may have to do some research and learn a little bit about GA state taxes (for both individuals and businesses) but it can definitely be done...granted make sure they understand REI since I would say that would be as important as understanding the different state's tax laws.