Most landlords think clean books means "I have receipts somewhere." It doesn't. When I hand a client's books to their CPA, clean means: Every bank account reconciled through month-end Rent matched unit-by-unit against deposits (not one lump "rent income" line) Repairs separated from improvements,...
I invest in a mix of fix-and-flips, rentals held in a few LLCs, and some private lending. Each one needs its books set up differently. Here's the setup that's worked for me, in case it helps anyone juggling more than one strategy. 1. One set of books per LLC. Keep each entity in its own file, wit...
Every year around this time I start seeing the same thing: an investor with four or five LLCs, one or two bank accounts, and a full year of transactions that have to be sorted out by property before anyone can file anything. I get why it happens. Opening a new account for every entity feels like ...
Quick share for anyone who owns (or is thinking about buying) a medical office, dental office or specialty clinic, like an imaging or surgery center. By default, these buildings are depreciated over 39 years. But a lot of what’s inside a medical building isn’t really “building” in the IRS’s eyes....
Every tax season someone hands me an hours log that was obviously typed up the week before. Same wording on every line, nice round numbers, 'property management - 4 hrs' thirty times in a row. If the IRS ever asks, that log isn't going to help you much. We've got about two months left in the year...
I'm working with a new accountant and am being directed to elect "S Corp" for my property management LLC tax designation. The property management LLC will manage all profit/loss/wages for my small portfolio. I know I've seen this debated in the past, and am trying to figure out what the best thin...
I've been doing a total gut renovation of my future short term rental for the last 10 months. I plan on finishing the reno the end of November. My wife and I make a good living with our W2 jobs and would like to offset our tax bill with a cost seg this year. I've kept a daily journal of all the h...
This post is mostly for my tax professionals colleagues and for my cost segregators friends. In 3 weeks (early November 2026), I am going to speak at the annual conference of cost segregation professionals. While my topic is technical (combining cost segregation with 1031 exchanges), I'm also pla...
How do you sanity-check your cost seg and depreciation? Once a portfolio gets past a few properties, and several 1031's with TIC's etc, the return gets complicated: cost seg studies, passive loss limits, a few entities, maybe an SDIRA. Beyond trusting your preparer, what do you actually do to mak...
Lots of cost seg threads this week, and nearly all of them are about the year you buy. I'm more curious about the year you sell. Here's a conversation I end up having as a CPA more often than I'd like. Someone did a study a few years back, took a big deduction, loved it. Now they're selling and t...
Our tax person, is closing their business at year end. Looking for recommendations. We're small but we invest through multiple entities including trusts and self directed 401ks (regular and Roth). We'd also prefer that they can handle our personal taxes also. We're located in AZ and also file in ...
Most of us compare a flip exit against a rental hold and pick the bigger number. Kasing Ng, a CPA and former Big 4 fund auditor (a few of you know him from here), wrote a guest piece for me on why that comparison is usually pre-tax, and why the after-tax version can flip the answer. The short ver...
For married couples tracking hours together, how do you keep your logs organized between both spouses? Since spouse hours can be combined for the material participation tests, but one spouse still has to hit the 750-hour and 50% REPS threshold on their own, keeping everything mixed in one shared ...
I know things like listening to real estate podcasts or scrolling Zillow don't count toward REPS or the 100-hour STR rule. For those of you who have gone through a CPA review or an audit, what are the grey-area tasks that your CPA told you to remove from your time log? Trying to make sure people ...
I'm a non-US person (no SSN, not a US tax resident) and the sole owner of an Ohio single-member LLC that holds a rental property. The LLC is a disregarded entity, and I haven't made any election to have it taxed as a corporation. My property manager is asking me to sign a W-9 and says everyone si...
Looking to significantly scale my rental portfolio this year and looking for a new real-estate-focused CPA experienced with cost segregation, bonus depreciation, and proactive tax strategies for BRRRR type real estate acquisitions. My previous CPA is well known through social media circles, but t...
A recent thread here asked whether a cost segregation study really moves the needle or whether it's overhyped. The answers were all over the place. Most of the disagreement came down to one thing: people treating a deduction and tax savings as the same thing. They aren't. A deduction lowers your ...
I just came from LinkedIn. If you have access, I'm recommending a post: Matt Hamilton, CPA . His graphic, hand-drawn: DEPRECIATION IS A LOAN. Massive re-frame.
A rental sale that looked like a loss turned into a $90,000+ planning opportunity. A client came to us planning to sell a rental property they'd owned for about four years. The sale price was below what they paid, so the assumption was simple: take the loss and move on. When we reviewed the file,...
A real property trade or business can elect out of the §163(j) 30% business-interest limit. The trade nobody mentions next to it: once you elect out, you're stuck with ADS on your real property — 40 years for residential, 30 for nonresidential, straight-line, and zero bonus depreciation. That gut...
I had a client reach out to me regarding a ranch owned by his 86-year old father. His father's income is very low so he doesn't need the rental losses. The client will receive the ranch once the father passes. I explained to the client that if the father transfers the ranch to him now, then his t...
Has anyone had experience with Seneca Cost Segregation? They seem to be a relatively new company with limited reviews.
Honest question for the long-term rental folks: do you know your suspended passive loss number off the top of your head? Most investors I talk to don't. They know their rents, their rate, their cash flow to the dollar. But ask about the losses piling up on their return and I get a blank stare. He...
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