Cpa real estate questions

[Jose Mas Perez]

Hello, I am a newbie looking to invest in my first rental property in 90 days.

My question is what questions should I ask my current cpa to see if they are familiar / comfortable giving real estate tax advice? 

I don't want to be rude to him but also want to make sure he is going to be a good fit for me and my business as I move into this new industry. 

Any ideas or advice would be greatly appreciated. 

Thanks 

[Michael Plaks]

@Jose Mas Perez

Let's first decide what it is that you want to find out. If you want to gauge the CPA's technical competence, here're some technical questions specific to real estate, good for a test, in any order:

1. We're making $200k in salaries between myself and my spouse. Can we reduce our taxes with tax write-offs from rental properties? (Answer: no)
2. If we hold a rental property for 5 years and it doubles in value, is there any way to not pay capital gains taxes when we sell? (Answer: yes)
3. If we buy fixer-uppers to rebuild and sell, and construction takes more than one year - will our profit be taxed as long-term capital gain? (Answer: no)
4. Can we lend our IRA money to other real estate investors? (Answer: yes)
5. We both have full-time jobs. Can we qualify as "real estate professionals" if one of us obtains a Realtor license? (Answer: no)
6. If we buy new appliances for our rental property, can we deduct the full cost of appliances right away? (Answer: yes)
7. If I had a rental property for 3 years and never claimed depreciation, can I fix this mistake by filing amended tax returns for the last 3 years? (Answer: no)
8. Can I deduct 100% of the property taxes on my rental properties if they are higher than the new tax law limit of $10,000? (Answer: yes)
9. If I own my rental property free and clear, and I then get a mortgage against this rental and use the money to buy a boat - can I deduct interest on this mortgage? (Answer: no)
10. If I convert my old house into a rental for 2 years, and then I move back and live in the house myself for 2 more years, do I have to pay any taxes when I sell it? (Answer: yes)

Of course, the answers above have some exceptions, like almost any question. But then the CPA should say something like: usually yes (or no), except in some special cases.

Remember that technical competence is only one piece of the puzzle when choosing any expert.