All Forum Posts by: Todd Groom

@John Farady ok thanks. And yes they are legal lol but still a very long and expensive process to become a citizen. That’s why they are trying to find someone who can handle it all. Hopefully there’s some write offs in there somewhere. The legal way def is not the cheap way. But what I meant by green card holder was more that they are legally working and paying taxes if need be. I’ve heard some people say file married but separately vs jointly if they don’t have as much income or if they don’t have income? One person said don’t file at all if they didn’t make enough money. So it’s very confusing.

I forgot to ask an important question, do they have to be licensed in my state or the state the business is operating out of? Or does their license allow them to operate country wide?

Are there any firms on here anyone can recommend that have all three?

@David M. Thanks for the insight. Hopefully I can get a few more ideas. I’ll add to my question maybe it will help.

I already own a business w/ partners. That one has an accountant that handles everything but It's in a completely different field. I decided to get my feet wet with rentals to invest my money. I started in March and currently have 4 multi family properties and I'm operating as a sole prop for the time being. I need direction how I should operate this since I've also got another business That operates separately. I was going to do LLC but then watched where maybe I shouldn't. I'm buying more so really need to know how to set this up. I also may start buying commercial multi-family and that's another set of laws.

My business partner already owned 2 homes and we purchased a multi family together. It's 50/50 so we need help on figuring that out against what we each own. He is 100% Sched E. We were told that we need a separate LLC that pays his half out for underwriting reasons. That if he wants to use the income for suture deals without that LLC paying him they would have to use 100% of the expenses but only 50% income. It's stuff like that we're we don't have a clue.

So he needs someone to set up his properties as well with his disability, partner deals, Plus he rents out his personal home and is married to a green card holder. Again more tax codes to know. o yea, as you can see it’s a complicated scenario that I want to set up right.

@Jeff Lundeen people have long talked about how more people are leaving CA than ever. That’s true only to a point. Yes people are leaving, low income families who do not have college degrees are being pushed out by the high rents and cost. However, there’s also people moving in. You’re college grads, young with no kids and so on. So 5% may be leaving but 4% are moving in. It’s more of a change in tides than anything. I’ve read several stories on the issue after hearing this myself.

I’ve also read on the new issue brought on by Covid19. People working from home are now being told they can keep working from home. With that they no longer need to live close to work in the expensive cities. They talked about people moving to the suburbs just outside the city and abandoning the more expensive homes and apartments. The ones in the millions.

So from what I have read those leaving the cities are simply moving to the suburbs.

There are a lot of the above mentioned in here but how does one choose the best agent to go with? I'm sure everyone here is an expert at some level but like all things some are a better fit than others for a situation. From past experience I've learned that one person sometimes just wants to click a few buttons on turbo tax and others live it and know every loophole, tax break etc. 

We are in need of someone who can help in a few areas. Figuring out how to set up this business where I and my business partner get the most out of tax benefits and protections. My business partner also needs to get his taxes for this year prepared and filed. 

So how does one choose the right person to fit? I thought at first a Tax Attorney would be the best person to talk with but then people mentioned EA that I've never heard of. Then everyone seemed to be back and forth, a CPA is better than an EA, an EA is better than a CPA, an EA is cheaper than TA and knows the same stuff. Then I started to see using a different state as the business address may have stronger LLC protections than another like Nevada etc. It tough going the right rout.

We recently acquired a dozen or so multi-family properties. The previous owners gave one tenant reduced rent in exchange for him doing small jobs and being on call for maintenance. Once they sold the property he got mad and has decided he doesn’t want to honor the agreement. Normally this wouldn’t be an issue we would just fire him and raise his rent. However the issue is they did not document anything and signed a yearly lease. So the agreement is verbal but the lease is written.

I have tried to work with the tenant and explain we don’t have anything to do with his past agreement but will honor it. He’s not happy and is now out of town all the time “working”. His way of avoiding any task we need done. I’ve given up even trying to make his agreement work. Market rent is $1000-$1200 for his unit and he’s paying $800. He was also promised 2 full size garages under his unit for free. Luckily there’s no written agreement so we aren’t giving in to that one.

Does anyone know any back doors to canceling a lease legally? I may have one out but would like to run it by anyone experienced with this situation. I’ve noticed he has a girlfriend with kids who are always there. They are not on the lease and he doesn’t have anyone on it. Would this be grounds to terminate his lease if she lives there? Do I have to give him the opportunity to fix the problem? We are also paying for trash, water and sewage. So more people in his unit is a higher bill. He’s under a lease until the end of November.

Other option just leave it as is take the hit and refuse to renew.

Any help would be appreciated.

We had one tenant turning over due to getting a larger apartment. More kids bigger unit the way HUD works. We had a waiting list for those to fill her place. If you are able to do HUD / Section 8 and have the ability to weed through bad tenants on paper then I recommend going section 8. It's almost recession-proof. They lose their job then they get more paid for them, If they miss a payment I call their social worker. The payment is there right away.

I am trying to locate the BP Florida yearly lease agreements. The package I downloaded has 2 lease agreements and one is labeled yearly however when opened its the same as the month to month. It even states, Month to Month. I'm assuming maybe there is a yearly out there? Looking for the fillable PDF one, Thank you!

Also plan on collecting rent. out of 8 units, 4 of them are section 8, 2 of them work in healthcare, 1 works for nursing home and one gets disability. So their income does not change. Section 8 is a blessing during these times. And no issues with anyone yet. I'm really surprised more people do not go section 8. You charge the same rents, they are fearful of being kicked off so they pay on time and take care of the property. Anytime you do have an issue all you do is call their assigned hud agent. They immediately get a warning to pay or resolve the issue. There is a waiting list of about 3,000 families where I'm located. When they move out they have to or are supposed to leave the unit as they found it, move-in ready. You run the same background checks and vet them like you would any other tenant. So you can weed out those with a bad background. It's the sure way to go. I'm converting all of my units over to section 8

@Michael Plaks I appreciate the input, we both do its a lot to learn at once. The money he’s trying to file is not much. $800 a month for the house and a $600 a month for a room he rents. He wouldn’t try to lie over a few hundred bucks. Going forward isn’t the issue it’s filing for the prev year. He’s been trying to deposit the rents. But as you will read below it’s tough when your te rants kind of pay through out the month.

He’s trying to get everything on the books so he can use the income for deals. But for last year deposits don’t really help much since he can’t go back. There is a paper trail for sure. But it’s a tenant paying a week here, half a month there. Sometimes a payment went to a credit card sometimes it went to another contractor to do a repair. It’s all legit and it’s all documented in Stessa, paper receipts and handshakes. Just no consistent $800 & $600 every month. Kinda how they do things in the south. When someone’s late just take what they got they will always catch up.

Reading the feed back I think he’s going to just find a new accountant, sounds like best option for last years taxes.

We are in need of some serious help with our taxes as a whole moving forward. We are looking for an amazing CPA or tax Attorny to help figure out how to set up the right way. We have multiple income sources with multi own people. So CPA or Attorny drop a dm let me know your rates or consult fee.

Also here’s a big question / issue and part of why we need help from a pro setting up one deal we just did.

- multi-family unit deal we did together 50/50. Per underwriting while he would be only using 50% of the income he would be required to use 100% expenses. And the only way to avoid that is to create an LLC then pay him off that. Then they would be able to use 50% cost and 50% income on new deals.

Then we assume getting a paycheck from an LLC would cause a passive income issues with it not being schedule E, passive income.

Thank you for the information. I know the software will help that is why I am trying to find one. My question was asking what programs would be best if any are even out there for someone managing multiple properties owned by multiple investors. Also with some properties that are shared, owners. So one duplex, 2 owners and each owner also have individually owned properties.