All Forum Posts by: Nicholas Grandstaff

Hello all,

This is off the beaten path of real estate, however I taught this was the best place to ask this question and reach out to you or your connections. 

A close friend of mine is looking for a CPA to help her son who has moved away from home and devoted his life to the all things equine. He now makes all his income through various avenues of the equine industry and he's seeking help to get on the right path in various ways, taxes, retirement, investing, etc. 

Is there a CPA on Bigger Pockets who specializes in the equine industry or might have a connection to someone who does?

Any help is greatly appreciated! 

Nick

@Scott Jensen

I appreciate your input. That’s a lot of good info. I’m really leaning towards the cash out option over the course of two or three years to avoid the heavy tax burden that will come if I do it all this year.

Thanks again.

@Nicholas Gessner

The RMD, so I’ve been told, will be distributed over my life expectancy (90 something). I’ve taken two distributions at this point and the second distribution was twice the amount as the first. I’m assuming the amount of each distribution is dependent on multiple projections about the market and growth.

I could move the RMD into a Roth as I collect it. However, I’m 40 y/o and at some point, potentially I’ve already reached this point, time won’t be on my side to keep investing that way. Time is what has me looking at the option of cashing out and moving the funds into cash flow positive real estate.

Hello all.

I’m looking for someone to talk me out of cashing out of a beneficiary account if I’m making a big mistake. What say you?

Here’s the deal: I currently have a beneficiary account left to me by my father. He was over 55 when he passed. In 2019 I took the stretch option, meaning, for the rest of my life I take a required minimum distribution (RMD) from this account. It’s seen as income, so I pay fed and state taxes on the money received. I’m thinking it’s best to cash out now, pay the taxes (I’m going to pay them anyway) and use this money to invest in real estate. Given the assets I’m looking at I will most likely be able to purchase two properties, possibly three. By law, 20% federal and 7.75% state (MD) will be withheld. Hopefully I’ll see some of that back at tax time. I’m not sure if the real amounts matter for this conversation, let’s just say I’m dealing with 100K before taxes. Also, due to it being a beneficiary account I’m not going to have to pay the 10% early withdrawal penalty.

What are the reasons you would tell me NOT to cash out this account and move it into real estate? What am I missing? Is there a better way to deal with this account?

As always, thank you for your time.

Nick

@Adam Miglio congratulations Adam! Nice deal. Thanks for sharing.

@George Blower thanks for taking the time to give all that great info. Much appreciated!

@Patricia Taveras

Thanks for your response. It sounds like we have similar goals. Wile it will be a lot of work now, income and wealth through rentals seems like it has the potential to be more stable and robust down the road than a depleting 401K. However, I’m asking the questions now because I want that 401K around later in life as well. Thanks again.

@Basit Siddiqi

Thanks Basit. You’ve given me a lot to think about. I do need to investigate if I can take a loan against my 401K before I take any further withdrawals. I think that would be a wise move.

I'm a complete newbie to REI. This is actually my first post here on Bigger Pockets. I dabbled with the idea of REI earlier in life (I'm currently 39), however, I received mediocre advice and I just wasn't hungry enough at the time to go after it on my own. Now I've arrived at a place where my goals are clear and it's time to reach those goals through REI. I have great people around me and have been consuming the great content on Bigger Pockets. Good people and good information has led me to a spot where I'm anxiously close to embarking on my first deal. 

My question concerning my 401k is this: I've recently pulled 25K out of my 401k to invest in buy and hold RE with no early withdrawal penalties. I have the opportunity to pull another 25K with no early withdrawal penalties. Do you think pulling another 25K to start REI is a wise or unwise move? 

I’m only paying federal and state income tax on these withdraws and I’m not required to pay it back. These are all conditions that have been created due to the Coronavirus pandemic. There’s already been two opportunities for me to pull the money, I only took advantage of one. I just received a letter in the mail that I have another opportunity, between now and Dec 15 to make another withdraw. How far should I take this? Appreciate your thoughts.