All Forum Posts by: Natalie Kolodij
Natalie Kolodij has started 63 posts and replied 3635 times.
Post: Accellerated Cost Segregation against w2 gains or stock income
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Originally posted by @Ross Y.:
@Taylor L. And all…
Thanks for the input…. Here are a few more details.
Writing from my phone so it might be a bit fragmented! Thx!
I have not filed as real estate pro in past but my wife would qualify as she does all of our management and assists with our transactions. She does not show any other income against her social. We have rentals and we're focused on growing. My CPA is also having us set up an s-Corp for additional write offs such as paying our kids to help with things in the RE and consulting business, putting our vehicles in the Corp name, etc. we're putting our multi families in an LLC which will be managed by the s Corp and our primary in a trust. Topped off with an umbrella. We're trying to get our sh*t together financially for the future and crazy tax laws that are going to hit soon.
My primary career for a publicly traded company has done well and my CPA believes that our real estate portfolio with RE pro status and acceleration of cost seg could help offset the stock income so I don’t have to sell a bunch of it for the tax ramifications. We specifically found an older building with a high tax value over the land for this purpose.
Lots of moving pieces here. :)
These strategies are all new to me and I wanted to get some collective thoughts from the team!
That S corp is not a great idea for paying your children.
One of the biggest benefits to employing your kids if under 17 is that there are no payroll taxes due as long as they're being paid by the parents, a parent owned 1065, or a parent's SMLLC. By paying them from an S corp he's having you pay payroll taxes when it isn't necessary.
Also having a vehicle under the S corp doesn't automatically make it more deductible- it depends on personal use.
I'd recommend consulting with a REI specailized tax pro before taking any of these big steps.
Post: Looking for a CPA in Springfield Missouri
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I'd reach out to @Jake Hottenrott - He is REI specialized and also an investor. He's based just outside of KC but works remotely with clients as well.
Post: Accountant in Central Virginia
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If you're open to working remotely there are several tax pros on the forums who speciaize in REI and work virtually with clients all over the country.
Post: Create LLC now or in the new year?
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If it's going to be a partnership or S corp - wait.
Nothing is worse than needing to file a whole return for 4 days of business.
You'll still pay the same cost- it's still the same amount of work.
Post: Explained: How CPAs charge you (and why)
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I feel like I need this printed as a creed on my office wall.
Post: Help with Accountant Recommendations!
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If you're interested in working virtually most of the regulars on the tax forums here are REI specizlized and work with clients all over the country.
Post: Can I depreciate assets which came with the property I purchased?
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Originally posted by @Basit Siddiqi:
@Jacob Wiltshire
The amount that the original owner paid for the appliances is not relevant to you.
Your purchase price of $390,000 was for the real estate, land and everything inside.
Now the issue is how to assign a price to everything.
In theory, it should be based on FMV.
Best of luck.
A reasonable allocation determination is what's required- not necessarily a cost seg.
If those appliances were recently purchased it could be utilizable as it may be current FMV.
So it could be part of the solution to how to assign the cost across the assets included in purchase.
Post: Yet another Capital Gains - personal home turned investment home
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You need to occupy it/ own it fora total of 730 days( 365x2) (does not need to be consecutive) within the most recent 1,825 (365x5) days
It's literally broken down to the day- so if you live in it for 730 days
Then rent it for 2,000 days
You will no longer qualify for the exclusion. From the point of 2 years you occupy it you can hold it/ rent it for up to 3 years (365x3) and qualify. If you go over that you lose the exclusion fully.
Post: Does your CPA charge you for a few questions over email?
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Originally posted by @Michael Plaks:
There're no industry standards in what you're asking about. For example, in my firm it's an all-inclusive annual service, and we do not count questions or minutes or tasks. In other firms, you will be on the clock, but everyone has his/her own way to manage the clock.
What's important and apparently was not done in your situation is a discussion of how the charges are done with this particular accountant and a common understanding upfront. Chalk it up as a lesson learned.
Michael nailed it- is there a secondary document that listed out what that agreed upon frequency for discussions/ questions was?
Post: Does your CPA charge you for a few questions over email?
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Depends on what the engagement letter says and how the firm operates.
I worked for CPA firms that billed hourly for ALL work. So if an hour of my day was just "answering quick questions for clients" and not putting it down as billable.
I'd look bad. In tax firms often your raises/ bonus/ ect (like many jobs) are based on your profitability. So having it look like I did 7 hours of work vs. 8 was not great.
Now, the Parnter/Manager can write that time off (Chose to not charge the client)- if it's a good client they often would.
But as mentioned above the starting point is if you're hiring someone for their skill/time- assume you pay for such.
At this point now that I have a firm it's structured where it's inclusive- and it's so we don't deal with this pain point and can plan/communicate without surprise billings later.
But a lot of firms don't do inclusive pricing- and so time= billing.
Examples of things I think firms would / woudln't charge for:
Wouldn't:
How much gain can I exclude if me and my husband sell our primary home we've been in/owned for 6 years?
vs.
Would Charge:
I have lived in a primary home with my husband for 1 year. My husband bought it 25 yaers ago. We spent 2 of those years living oversears before we moved back into it. It was rented while we were over seas. Also the basement is an air bnb. He bought it for $185,000 and I think we can sell for $793,000 -Can you tell me how much gain we'll have?