All Forum Posts by: Charles Perkins

Not sure in Ohio, but here a license would be required and public health would be required to inspect the kitchen.

Small scale might go under the radar but if any health issues came up or other issues that lead to an inquiry you may be exposed to liability.

Quote from @Natalie Kolodij:

Quote from @Brian Dela Cruz:

Quote from @Charles Perkins:

Quote from @Brian Dela Cruz:

@Charles Perkins

I appreciate your perspective. For me, taking the CPA exam was a transformative experience—it taught me more than the 30+ credit hours I spent in college level courses on accounting, tax, audit, and business law. The exam not only deepened my understanding of the intricate details but also helped me see the big picture of how our financial system works. It sharpened my tax research skills, which have proven critical when I began handling accounting and tax matters for businesses and real estate investors.

Moreover, earning my CPA was just one milestone in my ongoing learning journey. I went on to acquire several other credentials both before and after becoming a CPA, driven by my desire to master every facet of the profession. And while my professional growth is important to me, I also balance the demands of a busy family life with my wife and four young kids.

Looking forward to more insightful discussions like this.

 I'm a retired CPA, have a master's in taxation and have over 30 years experience.  I've met some very highly specialized experts in low income tax credits, corporate accounting and tax, as well as tax resolution.  I performed audit work in low income housing.  My income tax experience is primarily in tax resolution and real estate accounting.  

Along the way, I have met many fellow tax preparers in office settings, continuing education classes, and other meetings.  I've also reviewed work done by both CPAs and tax preparers in large and small firms.

I'm constantly learning new income tax strategies, reviewing my understanding of tax legislation and opportunities that are created with new legislation.  I would never claim myself an expert.

If not you, then who? If you're not an expert with a retired CPA license, a Master's in taxation and 30 years of experience, then who is? If not now, then when? If you're not an expert by now, then when would you be? What would it take for you to become an expert?

 I think what Charles is getting at is a very important idea that there is always more to learn and to me maintaining that mindset and humility makes someone much better in their field. 

There's a saying around recognizing the difference of someone with ten years of experience with someone who has one year of experience they've repeated ten times. 

And unfortunately that's very true with many professionals; after those early years of learning they stop growing, learning, developing, become set in their ways, etc. 

Someone hanging their hat on having done something for 20 years, or having passed a very hard exam 20 years ago doesn't mean they're an expert. They may be an expert; but those 2 facts aren't what can/will determine that. 

I worked for a CPA firm where the partners with 20+years of experience each hadn't taken a CPE class in years. They made staff sit through webinars to get the CE credits needed to maintain their licenses. They have a CPA license, 20+ years of experience and their name on the door but they stopped being an expert when they decided what they knew was enough and they were done learning or staying up to date on tax law. 

 This is exactly what I mean.  There are CPAs that are extremely good at what they do. They don't rely on the meager information obtained from continuing education classes, but instead they research more on their own.

The CPA exam is a start, but the education obtained from experience, asking questions, digger deeper, consulting with other professionals, as well as other sources is valuable.  I always strive to be better.

I've met many know-it-alls, complacent people and those that strive for excellence.  I choose always to be learning.  Tax law is complex and is actually a small part of the CPA exam.  The CPA exam proves someone is capable of doing well but these people are yet green and like a young plant.

Quote from @Brian Dela Cruz:

@Charles Perkins

I appreciate your perspective. For me, taking the CPA exam was a transformative experience—it taught me more than the 30+ credit hours I spent in college level courses on accounting, tax, audit, and business law. The exam not only deepened my understanding of the intricate details but also helped me see the big picture of how our financial system works. It sharpened my tax research skills, which have proven critical when I began handling accounting and tax matters for businesses and real estate investors.

Moreover, earning my CPA was just one milestone in my ongoing learning journey. I went on to acquire several other credentials both before and after becoming a CPA, driven by my desire to master every facet of the profession. And while my professional growth is important to me, I also balance the demands of a busy family life with my wife and four young kids.

Looking forward to more insightful discussions like this.

 I'm a retired CPA, have a master's in taxation and have over 30 years experience.  I've met some very highly specialized experts in low income tax credits, corporate accounting and tax, as well as tax resolution.  I performed audit work in low income housing.  My income tax experience is primarily in tax resolution and real estate accounting.  

Along the way, I have met many fellow tax preparers in office settings, continuing education classes, and other meetings.  I've also reviewed work done by both CPAs and tax preparers in large and small firms.

I'm constantly learning new income tax strategies, reviewing my understanding of tax legislation and opportunities that are created with new legislation.  I would never claim myself an expert.

Quote from @Brian Dela Cruz:

Data entry clerks - likely to miss deductions, overlook credits, miss carryforwards, make mistakes on tax law limitations

CPA - get it right, reduces errors, and helps you in building your wealth through tax savings

What are your thoughts? What factors did you consider for your decision? Aren't all tax preparers the same?

In my experience this is not a very good way of differentiating an uncertified tax preparer from a CPA or EA.  I've met good tax preparers who do much more than data entry.  I've also met CPAs that fail to do much more than data entry.

Income tax law is highly complex and I doubt sincerely any preparer is an expert in all areas of income tax.  Just as I would doubt any doctor or lawyer that claimed to be an expert in all areas of their field. 

CPAs and EAs are more likely to gain experience and further study because consumers are more likely to go to them with complicated or specialized returns.  General tax preparers tend to get less complicated returns and some are quite good with these returns doing much more than data entry.

Not all CPAs get it right and they can become guilty of simply entering data without reviewing, analyzing or clarifying situations especially in a long hectic tax season. Experience matters a lot.  Most education focuses on theory and less on practice.  A CPA just starting out is unlikely to have much practical experience yet.

First of all treating rental income as a hobby is a very bad idea.  I doubt seriously that you are properly reporting income on your tax return.  Hobby income and expenses are treated differently than investment activities or business activities. Chances are very high that you are not claiming tax losses that you should be.

There are many ways to create relationship problems and one highly successful one is mixing business with pleasure.  I would follow the advice others have given.

It would be a good idea to familiarize yourself with current landlord tenant laws and have an appropriate lease drawn.  Even relatives and friends can create liabilities and maintenance issues through their activities.

I worked in various capacities in construction.  First as a painter/accountant with a commercial painting contractor.  There l also learned to do commercial job take offs and estimating.  Later I worked at general contracting firm did accounting takeoffs for a variety of jobs.  They specialized in concrete tilt up, but did a lot of time and materials work for a self made real estate tycoon who owned a lot of Federal Way.

Along the way I got my CPA license and practiced in several differing sectors including doing some work with low income housing projects.

As far as my start in RE, it was with buying my first personal SFR and later moving to a new residence. Keeping the first as a rental. The rest came with time and experience.

I saw first hand the success of other RE investors having worked in a number of construction jobs.  There success inspired me to look at RE as both a short term and long term investment.

Turns out there are many successful investors in this area.

I value a property on information I have today.  The real question is have you done enough due diligence?  Part of due diligence is learning about the community and what is going on nearby.  No property exists in a vacuum.

If the city is reviewing a permit application for a landfill nearby that's important to know today.  If you're in a flood zone it is necessary to know and factor in.  A flood or hurricane may not have harmed the property recently but has it historically? I want to know these things today when making a decision.  Good due diligence is much more than numbers.  The risk factor is oftentimes an important factor I consider when deciding on a property.  Appreciation and value add opportunities are also a factor though generally they don't change my offer.

It sounds like you have a great background for investing as well as assisting other real estate investors in buying suitable real estate.  The brokerage should be very glad to have you onboard.

I'm looking forward to your future posts as you share your success.  Good luck on your new adventure.

Quote from @Jerry Huerta:

 After 30 years, what advice would you give in real estate? 

Good due diligence habits are important when investing.  I personally walked and researched every property prior to investing to understand what I was buying, what could be done to add value and what I should expect in cash flow and appreciation.

Learning what makes a good investment for you is absolutely necessary.  There are a lot of ways to invest in RE and each requires building necessary skills.  

In my opinion a fully passive RE investment is the most risky because you give total control to others.  Reducing risk requires at least some time spent in research and involvement in a deal.

There are many other things you learn along the way as well.