Tax advisor/Tax prep

15 Replies

I have decided to move on from the family accountant who has little background in real estate.  I just purchased 12 units across 4 buildings, which brings my total portfolio to 14 units 5 buildings.  I would classify my knowledge as weak in the tax realm.  I'm looking for tax advisor/prep suggestions in the Northern Colorado area.  I understand that today's technology makes it easy to do business with anyone almost anywhere.  Therefore, I'm open to any quality candidate.  Suggestions?  

@Blake Andrus

You're right about today's technology. This forum features at least a dozen of tax accountants specializing in real estate. Browse this forum, read the answers that we provide and contact whoever you like privately.

But do it quick. The IRS deadlines are right around the corner, and some of us may not be taking new clients at this point.

As Michael mentioned, there are several CPAs on here who work with clients remotely, including myself. Contact a couple and interview them and see who you think is the best fit. Good luck!

@Jason Graves

Congrats on accumulating so many rentals in such a short period.
I just read your profile and you are an accredited Investor. 
Cost Segregation is great and has many benefits but it doesn't benefit everyone.
You should have a consultation with a tax advisor and a cost segregation expert to see what the cost of the cost segregation is and if it will benefit you.

Originally posted by @Basit Siddiqi :

@Jason Graves

Congrats on accumulating so many rentals in such a short period.
I just read your profile and you are an accredited Investor. 
Cost Segregation is great and has many benefits but it doesn't benefit everyone.
You should have a consultation with a tax advisor and a cost segregation expert to see what the cost of the cost segregation is and if it will benefit you.

@Basit Siddiqi Last year a partner and I planned on doing a project together. He funded my single member LLC with $50,000 to buy a property and the deal fell through. (He is not part of the LLC) Since it was money "In", I included it as income on my taxes last year on my Schedule C, so it has been taxed. The money has just been sitting there and since we can't find an appropriate property I am going to transfer the money back to him. I'm going to pay him interest on his money.

What I'm not sure about is where to apply the funds & interest, is it Schedule C "Returns and Allowances" or is there a better place on Schedule E since it was intended for real estate investing and is accumulating interest? Can you suggest a solution?

@Michael Plaks

Last year a partner and I planned on doing a project together. He funded my single member LLC with $50,000 to buy a property and the deal fell through. (He is not part of the LLC)

Since it was money "In", I included it as income on my taxes last year on my Schedule C, so it has been taxed. The money has just been sitting there and since we can't find an appropriate property I am going to transfer the money back to him. I'm going to pay him interest on his money.

What I'm not sure about is where to apply the funds & interest, is it Schedule C "Returns and Allowances" or is there a better place on Schedule E since it was intended for real estate investing and is accumulating interest? Can you suggest a solution?

Account Closed

The solution is to amend your prior tax return and remove it as income. It never was income, it was a loan.

Originally posted by @Michael Plaks :

@Mike S.

The solution is to amend your prior tax return and remove it as income. It never was income, it was a loan.

 Brilliant! Thanks.

Will that trigger an Audit? Seems like the kind of thing that would.

Originally posted by Account Closed:
Originally posted by @Michael Plaks:

Account Closed

The solution is to amend your prior tax return and remove it as income. It never was income, it was a loan.

 Brilliant! Thanks.

Will that trigger an Audit? Seems like the kind of thing that would.

Anything can trigger an audit. But this situation is very straightforward. If a client wanted to pay me to defend him in such an audit, I'd suggest he saves his money and just  explains the situation himself.

Blake,
I recommend finding an accountant/bookkeeper that specializes in real estate over one that is local. You may want to consider working with your accountant/bookkeeper remotely to expand your options. I would also recommend looking for someone who is willing to work with you throughout the year, not just when preparing your tax return. You will need help throughout the year with keeping your books current and balanced, rather than just year-end.

Good luck and let me know if you have any questions.