CPA license and Real Estate Investing

[Alan L.]

Hi,

Are there any CPAs on this forum that have participated in any real estate investing themselves? and how has their CPA license benefit them (in anyway or at all) in their real estate investing activities?

I'm just wondering if there is any benefit of being your own CPA in starting out in this area of business.

Any opinions are appreciated even if you are not a CPA.

Thanks!

[Keith Borg]

Alan,

I'm a real estate investor and CPA. I started investing because I saw the returns my clients were earning from their real estate deals. Since then I’ve invested in single family rental homes and multifamily apartment complex through a partnership.

As a tax professional and tax strategist I have insight into my clients’ numerous deals. My clients invest through: single family rentals and flips, multi-family apartments, land development, and larger commercial real estate. I get the experience of working through many more deals than just my own. I’m able to see what techniques worked and didn’t work. A good CPA working with real estate investors will provide sound tax advice AND may act as a real estate consultant based on the multitude of deals the CPA sees every year.

I joined a real estate group, Lifestyles Unlimited in Texas. The group stresses the importance of building your real estate team. A typical team is comprised of a Real Estate agent, lender, appraiser, contractor, CPA, etc. Having members of that team, such as a CPA, in a real estate partnership can provide tax, accounting, and experience from many deals. Plus, a CPA in your partnership provides a learning opportunity for all the partners.

As my specialization within the Real Estate investor community grows, I’ve gotten to know a number of investors as clients and through networking providing the opportunity to help form partnerships as a sort of “partner matchmaker”.

Most experienced investors know enough tax to “be dangerous”. These investors usually know when they need to consult a CPA to work through the intricacies of a deal. The single biggest mistake I see is consulting your CPA and requesting advice after the deal is done. Paying your CPA for time to consult on tax strategy at the beginning of the year and specific deals throughout the year can save lot money in taxes and headaches at the end of the year.

While this response is not intended to be a sales pitch, yes I’ve found my CPA license to be very beneficial and I’ve learned the value of contacting a professional in the areas I’m personally not an expert in.

Keith Borg, CPA

The information has been provided by Keith Borg, CPA for general information purposes. It does not constitute legal, accounting, tax or other professional advice or services and is presented without any representation or warranty as to the accuracy or completeness of the information. You should consult a tax professional for your specific situation. In no event will Keith Borg, CPA be liable to you or anyone else for any decision made or action taken in reliance on the information for any consequential, special or similar damages, even if advised of the possibility of such damages.