Need to decrease tax burden and scale up!

12 Replies

Hello BP, I have a situation that involves my father in law who's a longtime investor with multiple free and clear small apartment buildings in a good market. We are looking for advice or an advisor that can help w the best strategy to reduce our tax burdens and maximize wealth opportunities. I also have a few properties myself And looking scale up.

Please respond or request an add so we can chat.

Thanks in advance! 

Originally posted by @James H. :

Hello BP, I have a situation that involves my father in law who's a longtime investor with multiple free and clear small apartment buildings in a good market. We are looking for advice or an advisor that can help w the best strategy to reduce our tax burdens and maximize wealth opportunities. I also have a few properties myself And looking scale up.

Please respond or request an add so we can chat.

Thanks in advance! 

 Your father-in-law might consider taking out financing on the free & clear properties and using the money to invest elsewhere. Borrowed money is not taxed. Properties with loans on them are less likely to be part of any lawsuit that may come along. Free & clear properties are very tempting for attorneys. Also, if he sells the properties he probably will have cost of sale and capital gains and will have less to work with. You would have to run the numbers to know for sure. 

Also, since I don't know what your father-in-law's plans are for the properties when he is no longer around, he might consider hanging onto them until he passes and whomever inherits the properties should have a stepped up tax basis which is a very big deal.

And, as another idea, he can probably do 1031 exchanges to other properties if that is his goal.

He may need asset protection advice and estate planning advice to go along with his investing.

@James H.

To give a responsible advice, we would need to know a lot more than you shared.

This forum features more than a dozen tax accountants who specialize in tax planning for real estate investors. Most if not all of us work with clients remotely, nationwide. Browse the forum, see who you like and contact privately. (By BP rules, we are not allowed to initiate the contact.)

@James H. As @Michael Plaks stated, there're tons of tax accountants on this forum. So you can talk to a few and figure out whom you'd like to work with. In addition, I recommend connecting with an estate attorney to determine the best strategy in terms of deeding properties or moving them under Trust and etc...

@James H.

I had a similar situation as you are describing. As the others stated your particular situation and goals need specific strategies. PM or call me if you want to discuss options

I would totally get an estate attorney to set up an irrevocable trust set up.  That would be your best way to protect what your father has but, if he wants to invest more or loan against some of the properties then I would say get a good tax accountant and then a great broker.  

I hope that helps, and have a great day!

Thanks all for your advice and recommendations! I understand there's definitely more personal information that's needed in order to get specific answers to my questions but the replies did give me a broad overview of what's needed and in what direction I should start, i.e. Searching the forum post for tax accounts and estate attorneys giving solid advice. I hope others in this situation also find the discussion topic useful. 

I guess my next question would be what makes a good tax accountant or real estate attorney and what's the best way to vet them? Perhaps the discussion can change to what would be good qualifying questions? 

Thanks all!!!

@James H.  

There are several good, long term tax pros here on BP. I would start there- I believe everyone is also an investor. 

@Steven Hamilton II Has a location in Florida- I would start by reaching out to him and seeing if he's accepting new clients. He may have an attorney referral for the state as well

Originally posted by @Natalie Kolodij :

@James H.  

There are several good, long term tax pros here on BP. I would start there- I believe everyone is also an investor. 

@Steven Hamilton II Has a location in Florida- I would start by reaching out to him and seeing if he's accepting new clients. He may have an attorney referral for the state as well

 Thank you for the mention. James, feel free to reach out with any questions. I have clients across the entire state of Florida and spend a great deal of time arguing with your local IRS office in Plantation.