Does it matter where my CPA and Lawyer are based?

Question

So I'm exploring investing out of state and I'm wondering about CPAs and lawyers...

Do I need a CPA from that state?

Do I need a CPA from the state I'm in?

What about a lawyer...is it best to have one from the state you live in? or the one you invest in?

So if you invest in multiple states...then would you need a CPA from multiple states? that doesn't make sense.

What have y'all done?In your experience what has worked best?

Chris Mason · Answer

Only a CPA from Texas can mentally process a Texas property tax bill. A CPA from most other states would have their head explode at how high home ownership is taxed in Texas, and it could be considered involuntary manslaughter on your part if you knowingly and intentionally submitted that information to a non-Texas CPA.

I myself have come close to head explosion several times when doing deals for folks that own real estate in Texas.

Chris Soignier · Answer

I don't expect my CPA to opine on my property taxes or fight them, just take deductions on the $ I actually paid.   They could be 10% of the property value, and it still wouldn't change his role in tax prep and advisory one bit.

Account Closed · Answer

Only a CPA from Texas can mentally process a Texas property tax bill. A CPA from most other states would have their head explode at how high home ownership is taxed in Texas, and it could be considered involuntary manslaughter on your part if you knowingly and intentionally submitted that information to a non-Texas CPA.

I myself have come close to head explosion several times when doing deals for folks that own real estate in Texas.

True.  And people always assume all taxes are high in CA, while the truth is CA has great property tax laws.

Personally, I'd want a local lawyer for any day to day stuff.  If you ever need to sue someone out of state, your lawyer can find you a lawyer there, and they could work together - your lawyer keeping the other one on track, etc.

Chris Soignier · Answer

Not necessarily.   Texas, for instance, has no state income tax.   I could easily use a CPA from anywhere, as long as he/she understands the franchise tax on Texas LLC's.

Philip Schultz · Answer

Chris Mason I'm exploring it because of how saturated the Texas market is and the cashflow potential in places like Columbus, OH.I'm not planning in Houston much longer than a few more years so I'm looking at other options near where I'll be relocating.

Jeff Green · Answer

@David Thompson

You mentioned you have a CPA in Scottsdale, AZ. Do you like them? Would you recommend them?

If so, I would appreciate if you could share their contact info with me.

Thanks!

Jeff

David Thompson · Answer

My CPA is in Scottsdale, Arizona and I live in Austin.  No issues.  She has an assistant that has helped me w/moving Texas property under my LLC formations. I saw her for the first time in person just a few weeks ago but had a five year relationship at this point.

Evan Nance · Answer

As an accountant currently pursuing his CPA.  I think experience working in individual states might help but someone you trust and total level of competence/experience is more important.  In regards to accreditation last time i checked i could take the test in other states (I have heard some states are easier) (I'm in Columbus Ohio and am taking it in Ohio) but you're still certified either way.  As for Columbus OH being a cash-flow area, maybe, i don't know another market to compare it to other than Cleveland which is a whole 'nother beast, Columbus might not be the cash cow the internet purports, I think there's tons of potential it might be hard to find deals if you're operating out of state though. http://www.dispatch.com/content/stories/business/2...

I work for a developer in the area and we are switching from building apartments to homes/developments.  To me that indicates that the asset class of homes are selling at a premium compared to the asset class of apartments in the area.  That's not hard data so take it with a grain of salt.

Definitely a good market and a great city to live in.  I am super interested in buying in this area myself.  Ill reach out to see if I can tell you anything else.

Joseph Gozlan · Answer

Lawyer should be local to where you do your business.

CPA however should not be selected by the state they reside but by their specialty. Find a CPA that specializes in RE investors and you will be rewarded no matter where they are located. If you are looking for extra assurances then verify you are not the first customer from your state and you will know they also have experience in your state.

Either way, lawyer or CPA, get a referral and don't just google it.

Bryan O. · Answer

Your CPA can be from any state. They are crunching numbers, and numbers know no borders :)  There is very little to know that is different from state to state. Laws vary wildly, especially RE laws so your attorney should be wherever the property it. I would not recommend on having your local attorney find one out of state for you. I would contact investors near my property and get a referral. Would your mechanic know another mechanic out of state? Not likely, but I bet they'd be happy to charge your for chatting with them to "keep your interest at the forefront" or some such billable nonsense  ;)

Does it matter where my CPA and Lawyer are based?

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