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Real Estate taxes costs for small LLC
My wife and I started our real estate journey last year and have 2 properties working on 2-3 more. We started an LLC in order to leverage the tax benefits of the business and possibly offset some tax liability. This is the 1st year I have anyone do my taxes and contacted a local CPA firm. They quoted $700 to do the business and personal taxes. That sounded reasonable and my savings would more than make up for that being in the 20+ tax bracket. Turns out that is correct we saved thousands with my wife qualifying as a real estate professional. However the tax bill came back at $2100. There was never a mention that the bill was going up just a phone call at the end that the time had been underestimated. When I questioned the obvious I was told that a lot of time had not even been counted and it would have been more. Going forward now that its all set up the bill would be more in line with $700-$1000. I gave them a spreadsheet with ALL expenses detailed so no receipts to compline all the income and other bills were included. The only extra paperwork was the closing statements.
Questions;
1. Is $2100 reasonable for small 2 unit business and personal taxes?
2. If not reference for Cleveland area CPA that knows real estate tax law
Most Popular Reply
An LLC has nothing to do with tax, it doesn't in anyway enhance your ability to deduct expenses if you were told that it was wrong.