Anderson Business Advisors Podcast AndersonAdvisors.com

Have you ever been caught off guard by the fine print in an insurance policy? Clint Coons, Esq. and Shawn Woedl of National Real Estate Insurance Group uncover the often overlooked details of property insurance that could spell disaster or salvation for your investment portfolio. We dig into the labyrinth of insuring your LLCs and land trusts, as we scrutinize landlord insurance and why it's a whole different ballgame from your typical homeowner's policy. From accidents on vacant lots, fentanyl-related incidents, dog bites, and even snakes in the rafters, Shawn's expertise sheds light on some wild scenarios where the tailored solutions offered by National Real Estate Insurance Group will have you covered.
Shawn Woedl is the President of National Real Estate Insurance Group. He is an industry-recognized speaker and educator with an emphasis on Commercial Property and Premises Liability. He brings over 12 years of professional and personal experience in real estate, business, and insurance to NREIG’s unique, investor-oriented brand.
Highlights/Topics:
How is landlord insurance different than a homeowner policy?
Some common policy exclusions you may not know about
Fentanyl-related claims, toxic mold may be excluded
Dog bite coverages, breed exclusions, snakes in the rafters!
Injuries/coverage on vacant land lots
Beyond primary liability - umbrellas and additional liability coverage
Coverage for LLCs and land trusts
“Subject to” property transactions
Don’t go in ‘blind’ - do your due diligence, or have NREIG do it for you!
Request a coverage estimate from NREIG with the link below
Resources:
Request a coverage proposal NREIG
https://affiliate.nreig.com/Anderson
Shawn Woedl LinkedIn
https://www.linkedin.com/in/shawnwoedl/
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=why-landlord-insurance-is-vital-for-real-estate-investors
Anderson Advisors
https://andersonadvisors.com/
Anderson Advisors Podcast
https://andersonadvisors.com/podcast/
Clint Coons YouTube
https://www.youtube.com/channel/UC5GX-U6VbvMkhSM1ONBiW8w

On today’s Tax Tuesday episode of the Anderson Business Advisors podcast, Eliot Thomas, Esq., is joined by Anderson CPA Barley Bowler. Barley and Eliot will cover some listener questions including strategies around deducting startup costs and choosing a business structure for loan eligibility, tax breaks like depreciation and claiming real estate professional status, paying taxes as a contractor on 1099 NEC forms, and when capital loss carryover deductions can be taken.Submit your tax question to taxtuesday@andersonadvisors.
Highlights/Topics:
"I joined Anderson and Infinity Investing in 2023, I established my first real estate investment, C-corporation, in December of 2023 for an official 2024 start date. What, if any expenses, membership, fees, et cetera, do I submit for 2023? ”We started to form the company in 2023. Do I hold out to list everything including the courses, business cards, opening expenses after the fact, or do I add these expenses to 2024?" - After the date of incorporation, everything's expensed as usual. “Pre-incorporation or pre-startup” costs are allowed to be deducted as long as they don't exceed $50,000
"I've heard we want a pass through real estate holding company that produces a K-1." That'd be a partnership. To enable easier lending on properties in the future. We talk about lendability. How do we get the most favorable lending criteria? Of course, it comes down to the bank, but we're certainly going to be covering that as well about bonus depreciation. We're trying to get a loan on a property. Depreciation is one of these expenses we have to pay attention to.” - in a partnership, as they mentioned here, You're allowed on the federal lending guidelines to have up to 70% of value.
"We got cost seg and bonus depreciation to offset. Can it offset 1099 income and your social security income?" - If we're talking about a traditional long-term rental, we first need the real estate professional status, then material participation.
"Hey, my tax is so high. What can I do? How can I reduce it?" - We potentially want to incorporate the business if the numbers are right, then we just look for all available deductions.
"Why did I have to pay employment taxes when receiving a 1099 NEC?" "I knew I'd have to pay, but it wasn't taken out during the year. I don't have a business, so why do I have to pay taxes?" - an independent contractor form, 1099 NEC, is subject to ordinary income and employment taxes.
"When selling an investment house like a rental property with some gains, what's the best way to protect our gain without sharing a good part of the check with the IRS?" - This is going to be your 1031 exchange, like-kind exchange.
"Can capital loss carryovers be chosen when to use?" "Can we pick and choose when we do our losses?" - With capital losses, you can use them up to the amount of capital gains you had plus $3000 that will go against ordinary income.
"Can I reduce my income tax from capital gains from selling stocks by using a loss in a real estate income or loss business? - If you have your real estate going on, some losses from there perhaps and expenses from that, there are some times where we can use that and times where we can't.
I just created a business at the end of March." When is it a preferred time to contact a tax specialist and set up a meeting to ask questions, have things explained, and see if we were a good fit for this individual? - If you need some specific guidance or calculations, that's when we may push you to do a billable tax consult or tax planning. In the meantime, hop right into the Platinum knowledge room.
Resources:
Tax and Asset Protection Events
https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=how-can-a-1099-contractor-reduce-taxable-income
Anderson Advisors
https://andersonadvisors.com/
Toby Mathis YouTube
https://www.youtube.com/@TobyMathis
Toby Mathis TikTok
https://www.tiktok.com/@t

Welcome to another Tax Tuesday episode of the Anderson Business Advisors podcast. Today, attorneys Toby Mathis, Esq., and Eliot Thomas, Esq., explain tax strategies for listener-submitted questions. The conversation digs into S-Corp vs. C-Corp for property management, understanding Unrelated Business Income Tax (UBIT) for non-profits, qualifying for Real Estate Professional status, and cost segregation and bonus depreciation for rentals.Submit your tax question to taxtuesday@andersonadvisors. 
Highlights/Topics:
"Is it better to have an S-corporation or C-corporation as your property management company managing your land trust and property held in your disregarded LLC? Are you required to have payroll with the S-corporation?" - With the management corporation, S or C, I personally like the C-corporation better.
“Where and when does UBIT apply to real estate investing and generally to alternative investments? - You're going to run into this when you have exempt groups or we'll call them entities, nonprofits are also exempt.
Does an accountable plan have identical benefits when comparing a C-corporation versus an S-corporation for a new business?" - being a new business or not shouldn't change too much. It's just a C Corp versus S Corp.
"How do you know how much you can convert into a Roth IRA from a traditional one without getting pushed into a higher tax bracket when you don't know what your investment gains will be?" - we don't look at the taxable gains - whatever your tax bracket is, that's what’s going to determine.
“Augusta rule. I am my own real estate broker office scene out of my home. I just hosted a large client appreciation party at my house using rooms in a garden that are not my office. Can I apply an Augusta rule to it? If yes, could applying the Augusta rule increase my chances for an audit and to what percentage? - Augusta rule is 288. You can rent out your home up to 14 times a calendar year. This is entertainment, you could maybe deduct 50%, I wouldn’t use Augusta for anything entertainment.
“My question is I've never been able to take real estate professional status due to full-time employment as a W-2 employee. I took early retirement on January 2nd of 2024 of this year. I am still being paid the remainder of 2024 biweekly, but not actually working. I'm a licensed real estate broker and spend a lot and most of my time on real estate rentals, subdivision development, et cetera. With this payout biweekly for the remainder of the year, can I qualify as REP (real estate professional) status for 2024?" - The prohibition to having W2 income is if you are actually working at your W2 job. Here, we're not doing any work for that check. You're just getting paid free money for 2024. You can go out and put your time into real estate.
“Given the time of the year that we're getting into with taxes being due especially in the fall, what are the first three steps in the tax planning process, and how does one approach the process differently for clients that earn less?" – Start with having excellent bookkeeping, identify where you are today, and plan where you are going in the future.
"What is the best way to purchase an existing business for tax purposes?" - You're going to buy the assets, you want to buy the assets because now you're going to be able to get those at your fair market value that you pay for them. We call it stepped-up basis in your assets…
"If I buy a short-term rental and do a cost seg the next year, I bought it, and listed it on Airbnb, can I rent it long-term for the following year or would that interfere with the cost seg done the prior year?" –This is a common strategy, there's nothing wrong with that - you want to at least rent it once in year one as a STR.
"If I claim bonus depreciation on my rental property, do I need to return or reverse it when I sell the property? What happens with bonus depreciation when I sell a rental property, or I necessarily have it in current?” - It

In this episode, Toby Mathis, Esq. chats with Jeffrey Cottle, Esq., Senior Attorney at Anderson Business Advisors, about the world of house flipping, with a focus on how to handle the tax implications. It emphasizes the importance of avoiding "dealer" status with the IRS and explores strategies like asset protection. Toby and Jeff discuss limitations placed on frequent flippers and analyze the pros and cons of different business structures like LLCs, C-Corps, and S-Corps. It concludes by examining the most common scenarios Jeff encounters at Anderson Advisors when working with house flippers.
Highlights/Topics:
Jeff Cottle intro
Flipping all comes down to ‘intent’ with the IRS
Avoid “dealer” status, and consider asset protection when flipping
1031 exchanges, installment sales are not available to dealers
Flipping risks increase with each new property you purchase
Pros and cons to LLCs, C-Corps, S-Corps
What is the “typical” scenario Jeff sees for flippers?
Send us your questions and ideas for future show topics!
Resources:
Schedule Your FREE Strategy Session
https://andersonadvisors.com/ss/?utm_source=aba&utm_medium=podcast&utm_content=how-to-structure-your-real-estate-flipping
Jeffrey Cottle LinkedIn
https://www.linkedin.com/in/jeffrey-cottle-019a75a2/
Anderson Advisors
https://andersonadvisors.com/
Toby Mathis on YouTube
https://www.youtube.com/c/tobymathisesq
 

In this episode, Toby Mathis, Esq., and Eliot Thomas, Esq., bring more of their tax knowledge to the masses, answering questions on HSA contributions, employing your children in your business, and keeping your assets in a self-directed IRA. Be sure to check out our FREE virtual events happening this month. Submit your tax question to taxtuesday@andersonadvisors.
Highlights/Topics:
"For an LLC that opted to be taxed as an escort is it better to not just. the profits and let retained earnings grow on the balance sheet and invest retained earnings in stocks or other investments in the name of the LLC? - the profits are automatically going to come down to hit your return. You're going to have to pay tax on those
"I am considering signing up with Anderson and contemplating having you amend the last three years as I don't think my CPAs or TurboTax gave me all the write-offs that I was eligible for as a real estate investor.I think I may qualify for a greater return, but also don't want to automatically trigger an audit. - the “triggering an audit” that's, I think, a really common scare tactic that's out there…amending is not going to create an audit.
"Can I continue funding an HSA account if I am no longer employed by the company that offered it but still have the account? Does it make sense to place it into a HSA investment account? - You certainly can continue with that HSA. Even if it's an employer-sponsored HSA, it is the employee's property, should they choose to leave.
"I have a K1 that will be late from the sale of an apartment complex in Georgia. I am a married filing separately tax payer. I will do an extension but still have to pay tax in April How do I know how much to pay without the K1? I Went through a similar sale last tax season and had to pay a late fee due to the late K-1. I'd like to avoid that again.- There is a safe harbor. If you've paid in at least 90 % of what will be due during your time period before April 15th,
"What are the benefits of having children as employees? Are there education expenses eligible for payment by the company? - if kids are paid underneath the standard deduction for that particular year, then there's no federal income tax on it. There are many benefits to shifting income to your children.
"If we live in our rental house for two of the prior five years to avoid full taxation on capital gain, take advantage of the $500,000 exemption for married joint-filing, can the remaining amount that we, remaining amount we will pay in taxes be offset? Can the remaining amount we will pay in taxes be offset by losses in our other rental properties? Capital if we qualify as real estate professionals during the year for filing. For example, if we purchase another property, and cost seg it, can those potential deductions be used to offset the taxes paid on the primary residence sale? - As long as they're in there for two of the last five years, they are eligible for ownership and use.
"How long do I need to have a property in service to rent to be able to deduct bonus depreciation from a cost segregation study? - you want to be reasonable, probably a reasonable amount of time, but if it was available for rent. That's it!
"My asset is in a self-directed IRA, so when you see SDR at IRA, that means self-directed. I am assuming if I sell it, the money is considered income and I'm taxed on it like any other income. Also, if I use the money from the sale of that property for the purchase of a different property, not kept in the self-directed IRA, can I avoid taxes? What is your suggestion in this type of situation? - there's a whole lot of misconception going on in this question. So no, we are not taxed on it like any other income. It's quite the opposite.
"Just started an ink taxes as C Corp What is an accountable plan? Is it something I need to join before I can get the benefit of it? Can any reimbursement be an expense with my personal name and get reimbursement like health dental vision cell p

Today Toby Mathis, Esq. speaks with Karim Hanafy, Esq., Anderson’s non-profit expert, about the top ten types of non-profits you can form to access tax benefits for your charitable activities. These range from familiar causes like humanitarian aid (both domestic and international) to education (including scholarships) and even combating social issues through activities and therapy animals. Research, veteran/elderly assistance, and various housing needs rank high, as well as animal welfare, environmental causes, and empowering communities. Finally, the importance of supporting other nonprofits, regardless of their specific cause, is also an option.
Highlights/Topics:
Karim’s background/expertise in non-profits
Top ten types of nonprofits
Humanitarian relief - domestic/international - food, clothing, shelter, medical care, housing
Education and scholarships- trade schools etc.
Activities to combat obesity, depression, and isolation - social and outdoor activities, therapeutic animals
Research - medical and financial support
Assistance for veterans and the elderly- medical, counseling, jobs, housing
Housing - this used to be number one - recovery from abuse, elderly, vets, under-resourced
Animals - sanctuaries, animal therapy programs
Miscellaneous - pollution, ministries, waste reduction, empowering the underserved, disaster relief
International giving - orphanages, food, clothing, shelter, animal sanctuaries, clean water
Supporting any of the above activities, or supporting other organizations that provide the previous support
Resources:
Email Our Team To Get Your Nonprofit Started
Schedule Your Free Strategy Session
Tax and Asset Protection Events
Anderson Advisors
Anderson Advisors Podcast
Toby Mathis YouTube
Clint Coons YouTube