All Forum Posts by: Jason Malabute

We’re not allowed to advertise ourselves directly here on BiggerPockets.

“Could you tell me about your experience working with real estate investors and the types of clients you typically handle? How have you helped them with tax planning?”

Since you’re managing a trust, consider asking, “How familiar are you with handling trusts, and could you share any examples of strategies you’ve used with similar clients?”

To assess their expertise in real estate tax benefits, you might ask, “What’s your approach to tax strategies for real estate investors? Which strategies have you found most effective?”

Communication is crucial, so you might want to ask, “How do you usually communicate with clients, especially during tax season? What’s your approach to keeping clients updated?”

Finally, on fees, “Could you walk me through your fee structure and what services are included? Are there any additional costs for specialized services?”

Hey Kylie! Great question. When it comes to taxes, both Enrolled Agents (EAs) and Certified Public Accountants (CPAs) can definitely help you out and are interchangeable. But here’s the thing: just because someone has an EA or CPA title doesn’t automatically make them a perfect fit for what you need. The key is to find someone who specializes in real estate, as they’ll have the specific knowledge that applies to your investments and can provide tailored advice.

Even better, if you can work with an EA or CPA who actually invests in real estate themselves, that can be a huge plus. They’ll not only understand the tax side but also relate to the unique challenges and strategies that come with real estate investing.

One more thing to keep in mind—don’t worry too much about whether they’re going to “take advantage” of you. A good EA or CPA will charge for their expertise, and it’s usually not cheap. It takes a lot of training and continuous study to stay on top of tax law, especially with all the changes in real estate tax rules. Instead of focusing on the price, try thinking about the value they bring. Are they helping you save or make more money than what you’re paying them? That’s the real measure of whether it’s worth it.

Hi Emilie,

For a transaction like this, it’s crucial to work with a CPA who specializes in international tax law. Transferring property from a Canadian-owned company to a personal name in the U.S. can have specific tax implications, especially when it involves international entities. International tax law is complex and requires years of experience to fully understand, so be sure to consult with a qualified professional in this area to ensure everything is handled correctly and any potential tax liabilities are addressed.

Hope this helps, and best of luck with the transfer! 

No PALs cant offset your capital gains from stock dividends and interest income.

Bonus depreciation rules is the same for short term as it is long term. It will benefit you to do cost segregation if you are a real estate professional or you make less than $150,000 modified AGI and then you can offset your active income with your passive losses.

Joe, if you're transferring a property from an LLC to your personal name, the tax impact generally depends on the structure of your LLC. Since it's a single-member LLC, the IRS disregards it as a separate tax entity, which means there typically aren't any capital gains or other tax consequences when moving the property to your personal name.

However, keep in mind that if you have financed the property, transferring it may impact the loan terms, and expenses like interest and property taxes might not significantly affect your overall tax situation.

Hi Jhamari, good questions! First off, I’d suggest connecting with a CPA who specializes in real estate and understands the specifics of Cleveland and Ohio state taxes. They can help you navigate local tax obligations based on your income sources and property ownership.

While taxes are definitely a factor, don’t let them be the only one. It’s also worth considering things like the local market conditions, return on investment, population and job growth trends, and other economic indicators. These factors can play a huge role in making a property profitable in the long run. Hope this helps, and best of luck with your investment journey!

Very good article. A CPA (Certified Public Accountant) can handle a wide range of accounting tasks, including audits, financial statements, and tax preparation, while an EA (Enrolled Agent) is a tax specialist authorized by the IRS to represent taxpayers in all tax matters—but CPAs have a broader focus beyond just taxes.

Ben forming a standard LLC with your current LLC as a managing member is possible, but the bigger question is whether you need a holding company. Consider if it will truly benefit your tax position, liability protection, or asset management, or if it will just add unnecessary paperwork.

If you’re in a state like California, keep in mind that you’ll have to pay $800 annually to the Franchise Tax Board, file a periodic Statement of Information (SOI), and submit a Beneficial Ownership Information (BOI) report.

It’s a good idea to consult a real estate attorney to ensure you’re making the best decision for your specific needs.

Heidi, if you do a 1031 exchange, both the capital gains and depreciation recapture can be deferred, but the recapture isn’t eliminated—it just gets pushed to when you sell the new property. If you receive any boot (like cash or non-like-kind property), then some of that recapture could be triggered and taxed. Now, when it comes to cost segregation, it accelerates depreciation, which means more of it is subject to recapture when you sell. However, in a 1031 exchange, you can still defer that, but it gets tricky—just like Michael mentioned, it’s a complex situation, especially with cost segregation in the mix. It’s definitely something to discuss with a tax advisor who knows these ins and outs. As for your scenario of exchanging two Airbnbs into an apartment complex, it could be a good move if the complex is a strong investment. Just remember that all the deferred gains and depreciation recapture will carry over.