GDNIP Ep 23: Creative Uses Of IRAs And How To Get A Property Out Of It

Everyone tends to think they can never really do anything with IRAs. Gail and Chris set out to give us the creative uses of IRAs, going deep into the rules and how you can get a property out of it. Gail shares about a property that has her whole IRA at risk and discusses how she got out of it, showing what rules apply when you have contradictory rules between the township where it is happening and your own contract. They then talk about how Cash for Keys could be used while reflecting on the moments in the note business that gives great satisfaction.

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Gail Anthony Greenberg & Chris Seveney Creative Uses Of IRAs And How To Get A Property Out Of It

Creative Uses Of IRAs And How To Get A Property Out Of It

I am your cohost, Gail Anthony Greenberg. I’m here with the ever-effervescent Christopher Seveney.

Gail, how are you?

Chris is all refreshed because he just came back from yet another vacation. How many is it now, Chris, where you go off and have an adventure and I’m still sitting home freezing?

I like to take hours in the cold months. This has only been number two. We went to Thanksgiving. I took some time off and then we took the kids down to the south. They ended up having school canceled on Friday and Monday was a teacher day, so the kids didn’t miss any school. It was nice going down this time of year. It was a Super Bowl with my beloved Patriots in the game. I enjoy being in Atlanta and as I’ve gone to a Super Bowl once in my life, which is an adventure. It’s good to be back refreshed, recharged and back onto doing what I like to do.

I have to say I don’t know why there are so many Patriots fans down south. I happened to be going through the New Orleans airport during the Super Bowl, which was the best Super Bowl ever since the Eagles won and it was a great game. You have to agree even though you may not have enjoyed the outcome. When I was going through the airport, people were huddled. It was the final couple of minutes. People were huddled around TVs and they didn’t all have jerseys on, but you could tell by the very hushed and depressing look of the groups that they were not with us on the Eagles.

There are a lot of New England Boston sports fans especially because of their success. My grandfather grew up during a time where the Red Sox never won. The Patriot never won. It was only the Celtics in the ‘60s and the ‘80s and the Bruins, once in a while so he never got to enjoy any of it. Anyone who’s grown up in the last twenty years, Boston sports has definitely been extremely spoiled.

I’m not a huge football fan, but I tend not to like teams that win a lot. I like underdog stories. Maybe that’s why I’m into notes. It’s all underdogs in notes. The tales of struggle. Speaking of which, what has just happened for you?

I am in the process of doing due diligence on about a dozen assets that I got under an agreement. It’s a little more than a bite that I can chew. I do about seven to ten, which is what I’ll end up closing on once I got eyes on the property that are vacant and abandoned. Some of them have title reports and issues and things like that. One is window list and one is a mortgage note that has never been recorded and is treated as a contract for deed. I’m scratching my head on that one. It completely blows my mind to the fact that there’s $95,000 on liens on this property that the city has placed on the seller. That one is going to be added to the Notes and Bolts Facebook group toxic asset list. Besides that, I’ve had a bunch of properties I’ve taken back and gone through and closing on a bunch of those assets. January 2019 has been a very busy month. As we roll through February 2019, I closed on about ten assets that I acquired plus I’ve got these other ones under an agreement. It’s been busy but I know you’ve got something that’s exciting and I’m happy for you about.

Uses Of IRAs: If you mentioned any number, you’re supposed to give them all.

I’m going to complain first that I am stuck in waiting mode on a whole bunch of things. I have three houses for sale in different places where a buyer has come forward. They want the house. I’ve sent them the mortgage loan originator, the uniform application for the financing and then I hear nothing. I try calling them and I tried tracking them down. I don’t know what it is. There’s something about that uniform application. It’s not as complicated as it looks, but it’s visually very intimidating. It makes me want to send many folks here, a little application that’s like, “What’s your name and where do you live?” We work with very scary looking paperwork for financial applications and things like this. I am starting to think that maybe, the people that we’re trying to offer financing to, this is a very big leap for them to deal with a document that looks like that. Do you think that’s possible?

I was talking to somebody who does a lot of the seller financing and what they do is, they set up a call with the individual and assist them in filling it out. We’ll go over the phone with each line and answer the questions they have and spend half an hour on the phone with them. They vet them first to make sure their incomes and stuff are in the range they want. We’ll set up a half-hour phone call with the individual to work through the actual application and to answer the question so they can get it completed. It’s an intimidating form. I remember filling it out when I was applying for mortgages for our house and it’s like, “This is a pain.” There’s a lot of information they ask for and it’s not something that takes two minutes to fill out. It takes a while and you need to just set a half hour or an hour of your time to fill everything out because you’re going to put all your bank accounts, all your assets, all your bills. It’s not easy.

We’ve talked to each other about the fact that when you advertise a property with seller financing, it’s illegal to mention some numbers and not others. You can’t say the monthly payment is this without saying, “The purchase price is this. We require this down payment. We will be financing this much for this long at this interest rate.” If you mentioned any number, you’re supposed to give them all. What I have done that clarifies for people and keeps you from running afoul of the law is I will put down, “You need a $3,000 down payment and a minimum of this amount of monthly income to qualify for this financing.” You can screen out everybody right from the beginning who are otherwise going to call you and be like, “Is this available?” They don’t make enough money.

For example, I have a rental right now that I’ve got out on the street and the first two things a lot of people ask is, “What’s the minimum term and what’s the income requirement?” I went online and the ad and put in a minimum of twelve-month lease and the minimum salary requirements are X. In that way, it answers those questions that save you from 50% of the emails you get or even more or people who are putting feelers out there who can’t afford the property but want to ask the question.

It’s even worse if you put things on the Facebook marketplace, which I highly recommend because you do get a lot of responses. They have a button on there that says, “I’m interested,” or “Is this available?” You’ll see you get the same exact message for everybody like, “Is this available?” People are going through there and hitting that button and sending out all of these messages to people. You don’t want to get more of those to plow through than you have to just to qualify. I may get obvious all caps like, “YOU NEED THIS MUCH INCOME TO APPLY.” Hopefully, we’re saving each other some trouble. It’s a good tip. Thank you, Chris. I feel that I’ve gotten my Notes and Bolts for the day already and we’re not even there yet. We want to talk about the creative use of IRAs and what the rules are and how to get a property out of an IRA.

I achieved a life dream of getting possession of a house in a city that I have wanted to own a house in forever. I don’t know why but I feel weirdly shy about mentioning the city. For those of you who know me and know where it is, my main concern is that everybody will come down and visit because it’s a popular destination. I purchased a contract for deed in my Roth IRA. Now my Roth IRA owns it because the land contract has been canceled through a rather arduous and suspenseful process. I’ve had a stomach ache for four months waiting to see if this would happen and trying not to care so much either way, but it’s a happy ending. It works.

Most of our readers have a fair amount of sophistication with IRAs enough to know that if your IRA owns a property, you personally are not allowed to use that property. You can’t go there. You can’t even sweep the front steps, your up and down relatives, your parents and grandparents, children, grandchildren, none of them can use it. Your siblings, for some reason, can use it. Your siblings are not disallowed people by IRAs. The IRS disallowed people any benefit from your IRA.

Cash for Keys is when you offer them cash for the keys to the property to move out. Click To Tweet

That’s why when you started telling me about this property and some of the things you had envisioned for it, that’s right popped off in my head like, “How are you going to do what you wanted to do?” I was confused honestly. I think, “You can’t do that.” You are very creative.

It all comes down to asking the right questions because it turns out, anyone can do this. The whole IRA world is mostly explained to us by your benefits person at the office and then the investment companies that will invest your money. None of them know a thing about real estate in your IRA and how it would work if one day your dream property comes to you and is owned by your IRA. I bought this contract for deed in October of 2017. At that time, the borrower was fourteen months behind in her payments. She had made a payment five months before I bought the thing. She had missed a lot of payments and was not vigorous in maintaining her good payment history.

I thought it would be a fairly simple matter too. This is the only borrower that I haven’t been rooting for. It was my dream to own a house in this locale. In a way, I was not persecuting her. The other issue about this house is that it was in terrible condition. That’s true of a lot of contract for deed houses, but this one seemed uniquely bad. It’s hazardous. It was a wooden house and we could see certain things just on a casual glance. There was an extension cord running from one part of the house into another part of the house. To me, that’s the tip of the iceberg of what’s wrong.

Did it have an indoor swimming pool?

I now have indoor pictures so for the first time, I know what it looks like indoors and it’s much exactly the way I thought. The owners were a young couple and honestly, I feel that I didn’t sleep for the year that I own this thing. I kept thinking to myself like, “What if they have children? How hazardous is it in there? Could there be a fire easily?” It would just be so horrible. It was a terrible thing because your hands are tied in situations like this. After we saw the extension cord, I went to great difficulty and legal expense to notify the borrower that we needed to do a safety inspection. After some pressure was applied, she was very unresponsive.

We ultimately had to not just send certified letters but tape the letter to her front door saying, “We have a right to do a safety inspection. You need to comply. We do not want to come in there without your permission, but we will if we have to and we will change the locks. You can call us at this number to find out where to get a copy of the new keys if we do that.” Finally, we got a response. She made an appointment for us to come over there. I sent a friend and a contractor over there to make a comprehensive list of not just what was ugly about the house but what was an imminent danger to the people living in there and the people in the neighborhood. The houses are very close together. The whole block could very easily go up.

My friend went over at the appointed time. The woman who was the actual borrower was not there, but there was a gentleman there who was clearly her husband or her boyfriend. He was belligerent and uncooperative and refused to let my people come in. That was very effective. My friend who went over there gave as good as he got and was yelling back at him. I can’t say these would have been an effective video to show in court, but it worked. I was not going to risk anyone getting hurt, including the borrower and her boyfriend by having a confrontation that could potentially become violent.

Uses Of IRAs: Most lawsuits are not a matter of winning or losing. It’s just the fact that you’re going to have to expend money to get it resolved.

It was very sobering to think about the fact that I couldn’t do anything. I couldn’t find out how bad the house was. I couldn’t do anything for the children who might be living there. I found out after stalking her on Facebook that indeed, there are children then I was terrified to think about the conditions. I know we’re not social workers, but you often find yourself in a situation where, if I’m just going to be technical about it, I own that house. They had a land contract, but had they been injured in there, they could have sued me because of the conditions in the house.

That’s always a bone of contention because they’re responsible for the care and maintenance of the property. If they did, would they ever win? It’s a fact that most lawsuits are not a matter of winning or losing. It’s the fact that you’re going to have to expend money to get it resolved or in this instance, the insurance company, which the rates may go up.

Most states are a function of someone going to an attorney and the attorney is looking up whether you have assets or not and basing it on that whether to proceed or not. I don’t know the statistic, but some very high percentage of lawsuits are settled instead of defendants taking the chance of getting a large judgment. I thought, “If children were killed, I don’t know how I would deal with that anyway.” My whole IRA was at risk and it was a terrible situation. When this borrower defaulted after I bought the note, before I even reached out to her, she brought it current. She paid thousands of dollars to bring it current.

That made it very difficult for me to have any ability to compel her to cooperate on anything because, at that point, she’s free and clear and was rolling along. She defaulted in the summertime. She reinstated at the end of 2017. In June of 2018, she missed a payment in this particular locale. If someone has to miss two payments, then you have to send a special letter that’s mandated. It has to be sent by a particular method of delivery and you have to give them six weeks to reinstate or make payment arrangements or something. Only if that doesn’t happen, you can cancel the land contract.

In this case, in July we sent that letter giving six weeks. In early August, I realized that we hadn’t sent that letter by the right method. You have to send a certified letter that is the law. We hadn’t sent it UPS, which is better in terms of deliverability because a certified letter won’t be left whereas the UPS letter was left on the doorstep. For that reason, we had to send another letter. In September, past the deadline for the first letter, but within the period of redemption for the second letter, she paid. It defaulted again in October and missed her second payment on November 1st.

We sent the letter. She didn’t redeem by mid-December. We were able to send a cancellation of the land contract notice and then she paid, but it was too late. We had already instructed the servicer not to accept the payment. We sent along with the cancellation an eviction notice. In this city, she would have had five days to leave, but because our contract said 30 days, it had to be 30 days. This is an interesting thing, to begin with, what rules apply when you have contradictory rules between the township or the city where this is happening and your own contract.

We all know that the contract for deeds that we buy do not have city-specific contracts written. The companies we buy from wrote one contract at the beginning when they were buying thousands of properties all over the country. It uses the same contract everywhere and you always run into issues about the enforceability of certain parts of it depending on where you are. These contracts all say, “As soon as you miss a payment, your land contract is void and is now a lease. You are a tenant, not a borrower.” In this place, that could not be true because everyone who’s going to have their contract canceled has to have this mandated 45 days to get back on track.

When it came to the five days that is mandated by the township versus the 30 days in contract, we’re back to using the contract. It’s a little frustrating, but it is what it is and you have to abide if you want things to stick. Because of what I assumed to be the borrower’s very difficult situation financially and as an incentive, even though I was legally on firm grounds, I offered her Cash for Keys to help her get started in her new abode or with moving. That was out of compassion, but also to avoid a situation where we would end up in court because you can be legally right and still lose in court.

Talk to different people. You'll find that they can sometimes open up a world of opportunities that you never thought of. Click To Tweet

I saw a post by somebody on Facebook mentioned that the tenant hadn’t paid in six months, had them illegally evicted, and the person filed an appeal. The appeal was upheld so now they have to go back again. The person hasn’t paid and the court ruled the eviction to place and person appeals and it’s like, “They’re going to reopen it again and it’s more money.” Cash for Keys is when you offer them cash for the keys to the property to move out and keep a broom swept and so forth. Without giving the dollar amount, what’s the range you see for Cash for Keys on deals for people out there to get an idea?

In this place, I asked the attorney’s advice. I had suggested a thousand and it turned out that that was very low for this area. He talked about Fannie Mae offering Cash for Keys too. It never even occurred to me that Fannie Mae would do that. He said that their range is $1,500 to $3,500. Your tax dollar is at work. I ended up offering $3,000, which I was happy to pay it frankly.

In my experience, I’ve paid anywhere between $300 and $3,000. It depends on property value as well as how much is it going to cost you to go through the legal and how the borrower has banged. If it’s been somebody who’s been very decent to deal with, then I don’t mind tossing them a few more bucks.

This borrower was never seen on her front stoop. I understood that even to be a situation where these were people who were trying to defend their home. They knew that if we went in there, they’d be in big trouble. They were fearful and that’s what they did. I don’t blame them, and I just feel that I wanted her to have the money and it was a meaningful sum. I was glad to pay for it. I’m glad because she moved around the corner and her new backyard abuts the backyard of this house.

Now you have this house in your IRA. Tell us what you’re going to do with it and how you’re going to make that work.

I thought it would be very simple because we all have quitclaim deed things to each other. It’s hard to copy a quitclaim deed and put the new names in it, but it turns out that there’s quite a process when you want to take a physical property as a distribution from an IRA. I’m going to describe to you what my IRA company has told me and what I’m doing. I’m not an attorney and you should talk to your professionals if you want to do anything like this. My IRA is a Roth IRA. The rules about taking a distribution tax-free from a Roth is that you have to be at least 59 and a half and the Roth has to have been open for at least five years for you to take any gains out of your Roth IRA tax-free. You can take back out of your Roth IRA the full amount that you have contributed to it over time. If it hasn’t been open at least five years or you’re not 59 and a half, you can take out your contributions tax-free because you’ve already paid taxes on that money.

It would be unfair for them to tax it again. Any gains you’ve made, you would have to pay taxes on if you’re not old enough and the IRA is not old enough. In my case, I met one criterion but not the other one. This applies whether you’re going to pay taxes or not. The process for deeding the property is that there has to be a minimum of two new deeds. The first one is you deeding the property. In my case, I have an IRA LLC. The property is owned by an entity that is my Roth IRA. The first deed I have to create is from my entity to my IRA custodian. In that case, it’s the IRA Financial Trust Company FBO account number.

Uses Of IRAs: If you inherit an IRA that’s already a Roth, it can be a Roth. If you inherit an IRA that is not a Roth, then it can’t be a Roth.

Because you have your IRAs truly self-directed as an LLC, you’re just taking that and deeding it. If you already had your IRA with Quest or MidAtlantic, would that process not have to be done because it’s already in the Quest Trust FBO?

That’s true because the deed would already be in the name of your Quest IRA so that stuff would be eliminated. After that, there will be a second deed from them to me personally. This makes sense because when I make a cash distribution, I have a second IRA that is not a Roth, that is an inherited IRA from my dad. Some of the rules about inherited IRAs is, if you inherit an IRA that’s already a Roth, it can be a Roth. If you inherit an IRA that is not a Roth, it cannot be a Roth unless you’re the spouse of the person you’re inheriting it from.

If you’re the child, you can’t convert it into a Roth. If the person you inherit the IRA from was already taking distributions, you have to continue to take a distribution every year based on the pro-rated actuary table based on your age versus theirs. If a person is in their 90s and they’re taking distributions from their IRA, they have to take a much bigger amount. The idea is that you’re supposed to deplete it and not pass it down to your ungrateful children. It’s been a sadness for me that I can’t turn it into a Roth, but no complaints.

Quest Trust FBO deeds it over to Gail Greenberg personally. You get that deed over. Everyone always thinks that in IRA, “I can never do anything with it.” There are penalties for certain things, but in certain periods of time, a lot of those rules can be altered or thrown out the window. Each situation or scenario should be reviewed. There comes a point in time where if you meet certain requirements, it’s okay to deed something that’s in there over to you, which is the same thing. It sounds like, “If I wanted to take a $20,000 distribution, I can take $20,000 out of that. If it’s a regular IRA and not a Roth, I’m taxed on it. If it’s a property that I want to pull out there into mine, I’m going to get maybe tax on it or whatnot.” There comes a point in time that can happen. That’s what blew mind because I wasn’t thinking at the time like, “You can’t do that.” Everyone always says, “You can’t do this.” All of a sudden, you just get that mindset but you can do that. You’re doing it that’s why I remember telling you and I was like, “Gail, what are you doing? You can’t do that.”

Fortunately for all of us, whether you have a checkbook IRA or you have a Quest or MidAtlantic IRA, you have an IRA Custodian. Even I have to answer to an IRA custodian. Even when I’m taking a cash distribution, I have to fill out a form to send the custodian the money, have it deposited, and then make a distribution request to them. This is doing the same thing just with physical property. I have to give them the property first so that they can give it back to me and I have to make a formal request for it. The other thing that I have to do is establish the value. I thought that was going to be totally okay. I bought it for this. I put this much into it and I got this much from it in income so it’s now worth X. That turned out to be completely irrelevant. The only thing that matters is, what is it worth? You have to get a fair market value.

Do you have to get a licensed appraiser to do it or can you just hire a BPO company to give you a BPO?

I would love it if you could just give me one of your DataTree AVMs because they are always so low ball. Now it can be a realtor and I happen to know a realtor in the city who hates the neighborhood that this thing is in. The value is low but surprisingly, although it is falling down because it’s in a hot neighborhood, the value came back at $65,000. Luckily for me, I have contributed more than that to my Roth IRA. I will be able to take it for no tax.

If it was not a Roth IRA and you paid $24,000 and you got it back and it’s worth $65,000, there is a gain of $45,000 on that. My guess is you’d have to pay the taxes on that gain if it was not a Roth and just a regular IRA that when you take the distributions you pay taxes on it. Do you happen to know that answer?

The note business often gives you these 'won the lottery' moments that come out of nowhere. Click To Tweet

I don’t. The way that they are looking at it, they’re the gatekeepers for value in and value out on IRAs. The value in is easy to measure because it’s cash. It’s a number but the value out, if you’re talking about a property, I don’t even know if they would subtract.

I don’t think they would subtract or be like, “You’re getting a $65,000 property. You’re paying taxes on a $65,000 deduction or withdraw.” Yes, you’ll pay taxes and they could be considerable, but if you paid $25,000 for it and you’re taking out $65,000 and you’re paying 20% taxes into your bracket that’s $12,000 in taxes, you’re in it for $37,000 that’s worth 60 years still. It’s good equity.

This is a place where my whole family enjoys vacationing. In fact, one of my kids was there when this happened and he’s a realtor. He’s able to send them over to look at the place. Fortunately, he lives in Brooklyn and has seen some terrible looking places so he wasn’t completely intimidated. For the first time since I started doing notes, my kids have never been particularly interested in what I do. The fact that I got a house, it has woken them up in a big way. I’m enjoying a moment in basking in the glow of my children’s adulation, which I don’t expect could happen again in my lifetime. I’m just enjoying it.

I’m waiting to get that note on a place in Hawaii that I foreclose on. It all sounds like, “I’ve got a house in Hawaii.” It’s like, “Now I might be interested.” The sad news would be, “I bought it my IRA so I’ve got to wait for another fifteen plus years before we can go use it. Our sisters could go use it, but we can’t.” That’s something creative and it’s not very complex in the sense of like, “You can do this.” It just goes back to things with note investing. You’ve got to review all your options. This isn’t even thinking outside the box but have that ability to think, “What are my options?” and review things and talk to different people. You’ll find that they can sometimes open up a world of opportunities that you never thought of.

I was saying to a friend that the note business often gives you these, “I won the lottery moments,” that come out of nowhere. This is certainly the biggest one that’s happened to me. This has been a dream of mine for a long time. If I got nothing else out of being in the note business, the fact that it gave me this, it’s so big and I’m so grateful that it could happen. It gives me such an amazing feeling about what we do.

You did what Scott Carson always tells people. You went out and you took action. You did it on a place that was an opportunity that had a slim chance of getting the property because the borrower may file bankruptcy or something else. It took a little bit of time, but it ended up in this best situation possible.

When I bought this, I remember having to talk myself down off the cloud. When I saw an asset that was exactly where I would want to own it, I felt such lust for this house. I said to myself like, “This might never happen. You can’t go into it feeling that this is going to be mine.” It only took a year and a quarter. At the time it was like, “This might never be mine, but this is going to be the next best thing because even if I can never own this house myself, it is in my company’s name.” It’s like I have it. It felt iconic and an avatar for a dream that I had and that I wanted to make come true like a vision board item.

Uses Of IRAs: You should never project your own way of thinking and values onto anyone else.

It’s like, “I’m going to be having this be the place holder for my actual house that I’m going to have there.” This makes me feel closer to it. I felt that this is a far too valuable piece of real estate. Their unpaid balance is low, the actual monthly payment is low. Who would let this slip away? People always surprise you in what they do. You should never project your own way of thinking and values onto anyone else that it could never happen. You always have to put yourself in a position where something can happen. It may never happen but if I don’t take the step, it will never happen.

It’s time to also roll into our last segment of some Notes and Bolts. I have seen a lot of posts. Some people are scrambling regarding taxes and getting people their 1099 and what do you send them and things by January 31st. I wanted to share some tips because I have a bookkeeper who does all my books for me. I was talking to them about some best practices and things. I want to share these with everyone out there. Whoever you’re working with, make sure you get a W-9 from them. In order to send them their 1099, whether it’s 1099 miscellaneous or 1099 interest, you need to know what the entity is.

Some of them may not go under the name that you think they go under like ProTitleUSA. Honestly, I have one from them. I don’t recall what their entity is, but it’s not ProTitleUSA LLC or something like that. It’s something different. You want to make sure it gets issued to the right entities as well as your partners or the JV partners that you have. You want to make sure the name is spelled correctly, or do they use a middle name or are they a junior or a third or second and whatever that is. Whoever you’re sending money to, get a W-9 from them.

If you’re distributing funds to a partner throughout the year and its principal and interest, make sure that you separate the two. It’s easier, at the end of the year, to go back and figure out, “How much should I give this person that’s a principle and how much was it that’s interest? There are two ways to do that. One is the memo or keeps a record like, “Pay this person $300, which $100 was principal $200 is the interest or whatever that is or just issue them two checks. One for principle and one for interest.” Because I have a bookkeeper who does it, in my bill pay system, I’ll issue it with two checks because it takes an extra five seconds which saves me time and send them and put everything down in a report. I already have a report to put the checks into. Those are the two things. At the end of the year, you know that I paid ABC partner $1,000 in principal and $4,000 in interest. It’s easier for you to send them that 1099.

We’re saying this so people will have a chance to save their skins for next year. For some reason, attorneys have their EIN numbers on their websites very often, but they are the only ones who do. I had a contractor to do some work for me during the year. He did a horrible job and we parted on very bad terms. Imagine how I felt asking him after the fact like, “Now that we are in such an argument about the terrible work you did, would you mind giving me your EIN so I can make sure you have to pay tax on the money I paid you?” Not surprisingly, I did not hear back from him.

I use TLO as a skip trace database. The TLO used to give you people’s complete Social Security numbers. They decided that it was too much exposure for them in doing that so now they blank out the last four digits. I had all but the last four digits of this guy’s Social Security number and then I started to think creatively about how I might be able to find out what those last four digits were. I went to look to see if he had ever declared bankruptcy and sure enough, he had. They have information about the person. I am delighted to say that that guy got 1099 and you won’t hear it from the IRS.

It is my understanding that if you do not have the person’s information, you can still send a 1099 and you just fill out as much as information as possible and put person refused. Send it to the IRS and you send them a copy too.

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When it’s a person you’re mad at, there’s a lot of pleasure to be had realizing that you have alerted IRS and that they should talk to them.

It’s much better, especially for high-end contractors. Always get a W-9 from them upfront. The other thing too if you’re hiring one and you want to make sure it’s a licensed contractor. I’ve had people use other entities like, “I’m ABC Concrete.” I’m like, “Send me your W-9.” He’s using his buddy’s company that if you look it up, it’s a licensed company, but he doesn’t have a licensed company. You see that happen all the time. Gail, we provided a lot of great content for people. If you want more great content, join us Thursday evenings at 8:30 Eastern time for our open mic Good Deeds podcasting. We’ve had three so far and each one has been excellent. We’ve had some experience note investors and some newer note investors and some investors hop on, ask questions, get feedback on things. It’s a completely open forum for you to ask anything. You can ask it anonymously. We can bring you on to talk about it. It’s a great resource for people out there to get your questions answered on the spot.

That has been fun and I enjoy the little community that’s growing around that. I enjoy hearing where people are. The learning curve is steep in notes, but you can slide down quickly if you are willing to ask questions and learn from other people.

Thank you and as always, we also hope you can go out and do some good deeds.

Thanks.