All Forum Posts by: Bobby Andrews

I recently switched from QB to Stessa to manage my rentals, flips, AirBnBs, and commercial units. I love the interface and think being able to see NOI and cash flow month over month is a big upgrade from QB especially as I continue to scale. My CPA mentioned that Stessa doesn't have double entry accounting and basically told me that it will work but I'm going to spend a bunch of money every year paying him and his team to make the Stessa reports "double entry financial statements that are required to ensure every item is being captured and the balance sheet, equity & cash balances roll forward each year."

I see people using Excel sheets (which is how I've tracked my flips last year) and my CPA is basically saying the accounting is a disaster right now but it seems like other people do FAR less than me and don't have issues...is this a CPA issue?

I'm open to using different software like DoorLoop or REI Hub which has double entry accounting but switching again will take a very long time. Anyone got any insight?

@Jay Hinrichs would love to pick your brain on this. Sending you a DM

Yeah I want to expand my portfolio to more non-STRs but want to know if I reach the hour requirements in my non-STR portfolio, would being self employed, paying myself a W2 salary (but most of my income is from shareholder distributions be an issue? Most W2 employees will have a tough job justifying that more time is spent in RE activities but since my W2 is far from "full time" does that make any difference if I track my hours? Guess I just don't know how I'd ever prove that I'm not spending any time in the insurance business given the income and W2.

I understand the qualification criteria for REPS but have a slightly unique situation that I haven't found any answers for by searching...

99% of my income is from my insurance agency that I solely own. Due to the level of income generated from that business, it's unlikely that I'll pass that amount in my RE activities. The interesting part is that I have the insurance business on auto pilot with my team, managers, etc. so I honestly don't spend more than maybe an hour per week on that business. My CPA said in the event of an audit it would be difficult to justify that 50% of my activity isn't coming from that business that produces significantly more income even if I can meet the 750 hour rule. I've been told to have my wife claim REPS but she's a stay at home mom and not involved in our real estate activities at all so that doesn't really seem feasible. I've done cost segs on STRs for the loophole but I'd like to get into some more properties that aren't STRs and use bonus depreciation to offset my insurance business. Anyone have any input on this?

Hey everyone - first post here but have done a lot of research and reading. Hoping I can get some guidance with my question!

I own a 3 unit commercial building that generates about $50K/year in net revenue. I'm self employed making about $1.2M/year in net revenue to me. Thankfully I have bought businesses so have massive deductions, book depreciations, and write offs. Even so, you can imagine my taxes are pretty outrageous so I'm considering buying some properties with 100% financing to offset my commercial building and reduce my taxes. I don't see me ever qualifying for REPS due to my other businesses and I'm not really concerned at all about cash flow so if I bought a few of these properties in an up and coming area it's for the appreciation long game...so here's my question. If my net revenue is say, negative $10K/year per property, I could theoretically buy 5 of these which would fully offset the $50K I'm making on my cash flowing property, thus resulting in a zero tax liability for my real estate portfolio, right?

Secondly, if you aren't a real estate professional and you had a negative cash flow property, do you still get to deduct the interest, property taxes, property management, and depreciation or would that only be deductible from my passive real estate income?

The idea is to expand my portfolio with some appreciation properties without much skin in the game so I can preserve my capital to add cash flowing properties as I see fit. $10K/year feels like a small price to pay for the long game. Plus even if I can't deduct it this year, it'll carry forward. Hope that makes sense. Thanks in advance! 

They aren't a scam but it may or may not be the right product for you depending on your goals. I own an insurance brokerage in CA and have IULs myself. If you want life insurance protection for your spouse or other dependents and want a policy that also builds a cash value account that you can withdraw from down the road, it gives you this option. Typically these policies follow the S&P500 index with a floor, and cap rate (if SPY yields 15%, an IUL won't typically pay that due to the cap). If you take out a loan from the cash value account it affects how long your policy last so if you were sold the policy with the notion that you can take out money later without consequences, it's not that simple. However, if your policy performs better than expected over the next 10, 20, 40 years...you may be able to take out some cash value and still have it last "forever" if that's what you want. But you may also only need it to last until you're 65 or 80. They give you a lot of flexibility which is nice but you should make sure to review it every couple years to make sure it's still performing how you want it to.