All Forum Posts by: Anthony Freeman

There isn't one. You're either accredited or you're not, based on meeting the criteria set by the SEC.

If you're looking for a form to give your investors requesting whether they're accredited, you can make that form. Include several questions asking which specific criteria they meet and how.

Private loans are generally better; simpler, you can get the whole deal, the lender has no decision making power and isn't going to hassle you if the property is doing badly (unless you can't make the mortgage payment of course).

The pros for private equity are when you're dealing with bigger deals like syndications on 100+ unit apartments. In those cases, it's basically a must to bring equity.

A straight-up loan will usually get you the best return on your investment. I say usually, because if you're inexperienced, it's possible that an equity partner could bring their expertise to the deal and earn you more, even after their cut, than you could earn on your own. 

Sometimes, if you're cash-strapped, an equity partner can help you save a deal you might otherwise have to pass on by providing down payment or other necessary funds that your lender won't provide. You would be more likely to entice a private lender to provide these funds by offering an equity share. Remember the old adage, "would you rather have 50% of something or 100% of nothing?"!!

@Anthony Freeman yeah, the above post is right on.  There's always a cost.  Now, you may not pay it yourself...meaning, the equity in your property might pay it.  And that's how we usually do it. Meaning, having equity in a property is nice...but it can't buy me groceries and it can fill up my tank with gas...but when I refinance the equity in the property can be used to pay the closing costs.  We "roll in" the closing costs.  That's how it normally goes. 

@Anthony Freeman if we are talking about your primary home...what's the rub against using a standard HELOC?

Hey, just checking in with my fellow real estate investors! If your Accountant has not done an Engineering-based Cost Segregation study on your investment property rentals, you may want to look into having one done. I just completed mine and I saved $275 K in taxes for just one of my properties (a short-term vacation rental). I was blown away and wanted to share this with the group.

I have a company that I found that will run a 100% FREE audit for owners of rental properties, to see if and where they can save you money and put some cash back into your pocket with your rentals. They use the very confusing/detailed IRS guidelines to save your company money over what a ‘typical’ CPA does (incorrectly keeping everything in the 27 ½ year or 29-year depreciation schedule- which is the 'easy' way to do it, yet it loses you a LOT of money that you could be using NOW to re-invest in your rental portfolio). You can also use this on vacation rental properties or even on any commercially leased or owned buildings. And the best part is, you can take this money anytime that I need it- a chunk now to lower taxes if I had an exceptional year, for example, I can save it for future tax filings. You definitely need this as a tool in your toolkit for income-producing rentals in your portfolio!

This company works WITH your existing CPA to take the benefits (unless you want this company to file them, instead, which they can do). I had my CPA take their audit and directed him to use it as he needs to, based on the income that I have each year- he did take some this year and we're saving a big chunk for future years.

They will complete a free audit for you for your rental properties (or on any small business that you may also own), and if there are NO savings, there is NO fee for the 'free look'. If they do find that you have a substantial sum of money that you can take immediately, they will tell you how much you can get back, give you their fee to recover that money- and you could decide to move forward- or not. They go back 20 years, and the fee to do all of this is only 10% (and even less than that, if you own multiple properties). It takes about an hour phone call, and they will work with your existing CPA to get the depreciation schedule already filed, to see what can be ‘tweaked’ to give you back a substantial sum of money NOW, rather than a dribble here and a dribble there over 27 or 29 years (will you have a need for it then, or would you rather have a big, lump sum now, to re-invest)? Three of my real estate clients over the past two months saved $650 K, $285 K, $189 K, $540 K, and $275 K- and none of them had huge rental portfolios. You can do this with just one rental property- even commercial buildings. Hotel and motel owners (and other small companies) save a lot more, because they have such large portfolios with a LOT of write-offs. some of your properties may not offer a lot in savings- but if they don't, they will tell you it's not worth doing- no harm, no foul. I have had one real estate client who bought a vacation rental property with me, and they ran the audit and told him that it wasn't worth doing, as he wrote all of his income down so that he effectively had a zero tax bill already- but that is pretty rare. 

A nice feature that they offer, too,  is that all of their work comes with 100% Audit Defense- unlike with other CPA’s work. My own CPA is now using this company to do Engineering Cost Segregation for his other Investor clients!

And if you are also a business owner, this group also offers other programs, like the Employee Retention Credit, which amounts to $26,000 per employee in 2022 (plus $5000 in 2021). 98% of businesses that qualify for it have not even taken it. My business didn't qualify, as an owner themself cannot take the credit, but it's nice to know that it is out there for those who do qualify.

Bottom line: if you haven’t had an Engineering-based Cost Segregation study done yet for your rental properties- you may be leaving some serious money on the table. Reach out to me and I will help you get in touch with them for a quick call to see what you might save. It’s surprisingly painless and you might be surprised by what they get back for you- I sure was! Happy Real Estate Investing! 😊Kristen Haynes

@Jill Paslier Depending on your locality...  You should be able to find everything online.  The Zoning Maps will show the swaths of the municaplity have which zone coding.  Then, look up the municpality's Code which will give you all the zoning rules pertaining to each zone type.  As much as people hate NJ, its all online for us.  Happy to chat if you like.

@Takisha Jones as mentioned, check your zoning.  Honestly, if you find that its not allowed, any architectural proposals that say it is should be chucked.  Zoning and "municipality issues" are really in the architects responsibility to check for you (in my experience).

As for reviewing...  Make sure they covered everything you want..  If you have a few, you can see if somebody thought of anything else that you didn't think of..  Look at their cost and payment schedule/milestones.  Look at their history of work.  Find out what sort of support they will provide, e.g. make the presentations to the municiplaity for your, interface with your GC/trades if/when they have questions.

Good luck.

However,  expecting "new ways to save me money multiple times a year" is unrealistic. Tax strategies should be discussed when you engage initially, and then occasionally afterwards when either your business changes or the tax law changes. Neither happens multiple times a year.