Hypothetical becoming classified as a real estate professional

[Jack Stalnaker]

Hello everyone, my name is Jack. I currently own one single family rental property, but I started a business last year and we are currently projected to produce just over 7 million EBITA next year. I plan on selling the company once we reach a 100m dollar EV some point within the next 3-5 years. After that point I want to go all in on real estate and become classified as a real estate professional by the IRS, and I’m wondering if anyone has advice on where I should be buying multi family homes/ apartments and what I should be looking for to ensure I receive the maximum return possible/ hedge against my massive tax bill that will follow the sale of my company. Any advice would be appreciated. I’m really just speaking in hypotheticals right now trying to come up with a plan for what I should do after all is said and done!

[Basit Siddiqi]

What is your goal, are you looking for the cash-flow to maintain your living style?

Building a company such as this is not an easy task and likely took a lot of energy and time away from friends / family(making an assumption, I hope I am wrong).
If you really did spend a lot of time, I would focus on spending as much time enjoying the hardwork that you did.

I would look to be as passive as possible in the real estate that you get into. You will likely have nice investment income regardless if your return is 8% or 4%.

My suggestion is to invest in a market that you are familiar with - Think of an area that you live in, grew up in, vacation often or visit friends / family.

Best of luck!