All Forum Posts by: Bryce Christensen

Looks like there will be one on July 10th.

http://www.biggerpockets.com/forums/521/topics/133752-houston-meetup-july-10-2014?page=1#p884143

Perhaps I'm just trying to make things too complicated, but doesn't it make more sense to maintain a single thread for everyone that is interested rather than starting a new one for each meetup? I have the keyword alert on Houston and it's like a tsunami- I have something like 400 notifications to catch up on. When I see "So-and-so replied to Houston Meetups", I jump straight to it.

I'm interested. West Houston / Katy area.

Best times would be a weekday lunch or Saturday afternoon somewhere with good A/C....

@Eric Black is right- whatever isn't rolled into the investment of a new property is taxable.

I'm an accountant, but I'm not YOUR accountant. This advice is provided for informational purposes and is no substitute for advice from a competent accountant familiar with the details of your situation. By using this advice, you agree to limit my liability to how much you paid for it (that's $0, btw). Have a nice day.

For flipping, using a job is probably a good idea- it has a clear start & end and it doesn't span more than 2 years. Using a class would clutter your financials rather quickly.

For holding a property for more than 2 fiscal (usually calendar) years, setting up a general class for properties by category (SFH, MFH, etc.) or geography and then having each distinct property as a subclass is a good idea, so you can print out a Profit & Loss as well as a Balance Sheet for each class or geography to make analysis easy.

If you get to the point that you have so many properties that this structure doesn't meet your needs, you might consider moving on from Quickbooks or grouping properties instead of presenting each individually.

I'm an accountant, but I'm not YOUR accountant. This information is provided for general purposes and is no substitute for advice from a competent CPA familiar with the details of your situation. By using this information, you agree to limit my liability to what you paid me for it (that's $0, btw). Have a nice day.

I thought it was interesting that @Bill Gulley mentioned that accounting is a subsidiary of finance. On the other side of the partition, we liked to say that accounting is the part connected to real life (cash), not just hopes and dreams... er, projections.

Before anyone attempts a Master's Degree (in really any field), I always ask people what they hope to get out of it. The usual answers go something like this-

1. I want to make more money. I tell them they aren't ready to go back to school, because they don't know what they want. I tell them to figure out what they want to do with their lives, then figure out what they need to learn and experience to do that job.
2. I want to learn new facts related to a profession. I tell them that facts change often, and they are better served by learning how to perform research on their own.
3. I want to learn new skills. I tell them that whatever you can learn in school is likely to be a few years old, because the professor probably hasn't been doing it in real time and the textbook is written, edited, etc. to the point that most of the material will be at least 3 years old by the time the book is in print. As a result, you won't learn the latest and greatest in school.
4. I want experience. Get and internship, an entry-level job, etc. A Master's Degree will only give you meaningful experience if you have a job you are working at the same time or before going to school- otherwise, you'll just take everything at face value, and then you'll get a rude awakening when you go out into the world where things aren't nearly so clean and a lot of the details your professor glossed over make all the difference in the world.
5. I know roughly what I want (career wise), but I don't know enough to get a job in that field. A Master's degree may be a path to getting the experience you need.
6. I want to gain access to a network of peers that will help provide me with future opportunities. A Master's degree may be the path to developing the network you seek, but only if you go to a prestigious institution.
7. I want a credential on my resume /

   I want a credential that requires a Master's degree.

   Great, go get a Master's degree.

Yes, I have a Master's Degree (in Accounting). I'm glad I got it. But it was only a fraction of my education, most of which happened because I was working while in school. So I would go to school, learn the theory, and then come back to work, and figure out how it works when the rubber hits the road. Then I would have quality questions to ask my professor for a subsequent class period.

@Adolf A. My rule of thumb is that if you have to make payments on it, you're buying more than you can afford.

Getting down to the reasoning behind it, why would a flashy automobile matter? To impress the person with your financial success. If you succeed in impressing that person, what will be the result? They will assume that you know what you're doing and have a stable financial situation. Why would that matter? If it does, it is because your success is supposed to make the deal less risky, or said another way, you will be invited to take on more risk. If you can't afford to drive a Tesla X or any other luxury car without payments, then driving up with one purchased on credit will encourage you to take on risks that are more appropriate for someone that can.

I like @Cory Binsfield idea of purchasing unassuming used cars, but be careful about having your business own your personal automobile, as you'll have to pay payroll taxes on the "fringe benefit" of personal use of a company vehicle.

I'm an accountant, but I'm not YOUR accountant. This information is provided for general purposes and is no substitute for the advice of a CPA familiar with the details of your situation. By using this information, you agree to limit my liability to what you paid for it (which is $0, btw). Have a nice day.

@Wayne Brooks is right. Depreciation is based on useful life and is not impacted by changing financing.

Just to make sure you're covered on the statement "after doing some improvements", you should be depreciating any improvements that extend the useful life of the property. You can only expense things that don't meaningfully change the useful life of the property. If you have to ask what "meaningfully" means, it's probably time to talk to a CPA.

I'm an accountant, but I'm not YOUR accountant. This information is intended for general information and is not a replacement for the advice of a CPA familiar with the specifics of your situation. By using this information, you agree to limit my liability to what you paid for it (that's $0, btw). Have a nice day.

Check out @Account Closed link. It spells out the issues pretty well and addresses all of the points I was going to mention. If you want advice specific to your situation, PM me. I can't give a specific answer in a forum like this because someone else might use it and then say they relied on my advice, which could put my license in jeopardy.

@Dave Olverson It depends on what you want.

• If you just want someone to prepare an individual Federal tax return for a few properties owned by just your tax unit (you and a legally recognized spouse), @Bryan L. is right- any CPA claiming tax expertise should be able to handle that.
• If you have a more sophisticated / complicated setup with partnerships or LLCs located out of state, it's a good idea to have a CPA / CPA firm that is familiar with the laws where each entity is regulated and taxed.
• If you are performing complicated deals or operating in a particularly tricky tax scenario (like a self directed retirement plan invested in an LLC you manage), then having a CPA / CPA firm familiar with real estate practices and applicable tax laws and regulations would be beneficial.
• If you are using real estate as investments that you wish to pass on as a legacy to your children (even if that will be in 50 or more years), a CPA familiar with estates and trusts may provide value to you so you can setup entities and ownership now and avoid big tax hits later when you've made a lot of money.

Based on what I know of New York, Washington D.C., and California, I wouldn't recommend operating in those areas without a CPA/CPA firm with understanding of those state and local tax laws.

There are economies of scale when it comes to these things, so my recommendation is to focus on a particular area for most of your investments to maximize the benefit of the legal and accounting advice you receive. But if you price it into the deal, you may be able to do very well simply planning on using a large enough firm that they have specialists for each area you invest in.

I am an accountant, but I'm not YOUR accountant. This information is provided for general, informational purposes and is no substitute for advice provided by a competent professional familiar with your particular situation. By using the advice, you agree to limit my liability to what you paid for it (that's $0, btw). Have a nice day.