Recent Blog Posts

  • How to be Successful with Short-Term Rentals
    Short-term rentals are a topic that is just buzzing with excitement and opportunity these days! Many real estate investors typically devoted to year-long lease agreements are seeing bigger profits partnering with companies like Airbnb and Vrbo. But as it is will all investments, higher earnings also come with higher risks. There are several strategies that will allow you to take advantage of the short-term rental opportunity and avoid the land mines in the process, so let’s get into the details. What are some of the benefits? Short-term rentals provide a completely different set of benefits compared to those of long-term rentals. Now remember this doesn’t mean one is better than the other, in fact, having a portfolio of different types of rentals is always advisable. Your income should increase. Lots of my clients have been able to double or triple their rental income with short-term rentals. For example, an average ... Read more
  • 10 Steps to Purchasing Your Next Rental Property
    As many of you know, our law AND accounting firm recommend to ALL of our clients to purchase at least one rental property a year for tax planning and wealth building benefits. It doesn’t have to be big, but at least something. Thus, I have created these “10 Steps to Purchasing Your Next Rental” as a guide for many of our clients that are real estate investors. I hope this may even help some of you that are seasoned investors. HERE is my AMAZING, yet SIMPLE list: Make a Goal. Set a deadline to purchase your first rental. Stay committed. Let friends and family know your goal. Write it down and set short deadlines to be looking at property and making decisions, rather than just ‘buy my first or next rental by X date’. Set manageable goals to get you to closing. Start Shopping. Just get out and start looking at rentals. Engage ... Read more
  • Why Entrepreneurs Need to Keep Their Day Jobs- At Least for Awhile.
    I know this may sound a little odd coming from a man that has been advocating small business since age 8. I was out there on the street trying to talk my little brother into helping me with my lemonade stand and various other hair brain schemes even through high school. However, one thing I’ve learned all these years in business myself, and also consulting thousands of clients, is that although there can be amazing rewards and benefits of entrepreneurship, it is still is an ‘up and down’ financially volatile roller coaster ride…especially in the beginning. Thus, whenever I have a new client call me on the phone with unbridled exuberance tell me they are marching into their boss’s office tomorrow to quit their job and quote the song made famous by Johnny Paycheck telling their boss to ‘shove it’…I tell my client to slow down and hold on for ... Read more
  • How to Hide Your Home Address from the Public
    Privacy is NOT asset protection…however Privacy can enhance Asset Protection. In fact for example, protecting your home from a lawsuit and protecting your identity from the public are two very different things. To tackle this difficult topic of privacy protection, earlier this year we had international privacy expert JJ Luna join our podcast and it was phenomenal. Listen here. I also used JJ’s book as a starting point and inspiration to dedicate an entire chapter to Privacy in my book, “The Tax and Legal Playbook”. I have absolutely loved JJ’s book, “How to be Invisible”, now in it’s 3rd edition. For those with a serious interest in privacy protection, I highly recommend his book. Over the years, I have had many experiences with clients who have shared traumatic ‘violations of privacy’ and I have been encouraged to continue studying, speaking and writing on this topic. One the more SHOCKING EXAMPLE’S ... Read more
  • Opportunity Zones when Selling Real Estate can Save you Thousands
    Opportunity Zones (OZ) investments were created under the recent passage of the Tax Cuts and Jobs Act, and designed to essentially help states jumpstart communities that have historically struggled economically. In theory, they have a two prong benefit; help revitalize dilapidated areas and stimulate the economy with development and jobs. If you remember Hurricane Katrina and the devastation it caused in the Gulf States in 2005, the government passed Go Zone legislation that played a major role in helping rebuild and renew areas impacted by the Hurricane. The government hopes for the same results with OZ. In a nutshell, this tax incentive allows investors to reduce taxable gains and possibly obtain tax-free growth if they re-invest capital gains into real estate within designated Opportunity Zones. The strategy can produce incredible benefits, but the window of opportunity is relatively short (especially if you consider the full development cycle), so you won’t ... Read more
  • A New Bundle of Tax Strategies – BABY EDITION!
    I had a wonderful phone call last week with two very awesome clients of mine. We were getting ready to discuss some business strategies when they decided to share some “news” with me. I curiously asked what the news was since I good tell that it was good. “We’re pregnant with twins!” was the reply. This was not something that had come easily for this couple, so beyond just the normal excitement around the announcement, there was an extra bit of happiness that rang through to me. I wished that I could have been present in person, as I would have liked to give them both a big hug! After we talked a bit about the baby, they asked a familiar question—“Is there any tax planning that we should be thinking about for the babies?” I chuckled and asked if I could defer the answer for a week and write ... Read more
  • Tax Strategies for US Military Veterans
    Coming back into the general population after serving in the Military can be a very difficult transition. In fact, for many of us that never served in the military, we can’t imagine the stress and challenges. With that said, and after a heartfelt thanks for your tremendous service on our behalf, we wanted to offer a few potential tax strategies that might make your transition a little smoother…at least on your tax return. Strategy #1: Pension payments are typically taxable, disability benefits are not The first thing to know is that pension payments received after retirement from the military are taxable and should be reported on your tax returns. If you also receive disability benefits from the Department of Veterans Affairs, you do NOT need to report these disability benefits on your personal income tax returns. Disability benefits may include the following items: Disability compensation and pension payments for disabilities ... Read more
  • The 1031 Exchange – A Real Estate Investor’s Secret Weapon
    To 1031 or not to 1031…that is the question. Back in the real estate boom of 2005-2008 the 1031 exchange was an often used tax strategy by real estate investors looking to avoid the tax when selling highly appreciated properties. However, due to the “Great Recession” at the end of the boom, the 1031 strategy got put on the back burner of most taxpayers minds as worries of job security, declines in retirement accounts, and economic instability became the soup de jour. However, Americans are known for their resilience and now, almost a decade after that near-fatal collapse of the economy, the sun has come back out again. Property values are up and again investors are looking for creative ways to get around the state and capital gains tax. Bottom line, the 1031 exchange has proven to be one of the most effective ways to save tax dollars today! The ... Read more
  • Tax Strategies for US Military Personnel- Active Duty
    At KKOS Lawyers and Kohler & Eyre CPA’s, we salute our brave men and women in uniform. THANK YOU for putting your life on the line to protect our great country. We honor and cherish your sacrifices that keep us safe. In turn, we try to give back where we can, personally, to you amazing service members.  As such we have summarized some important tax strategies for active duty military personnel. We work diligently to help our active-duty military clients as well as military veterans strategize and make the most of tax planning opportunities. Here are 5 tax strategy/opportunities to be aware of and discuss with your tax advisor each year. Strategy #1: Know what benefits/compensation are taxable and which ones are not! Like all U.S. citizens, members of the Armed Forces receive income that is taxable to them. This includes foreign source income (income earned overseas). Some foreign income ... Read more
    There’s a lot of talk on the internet in the entrepreneurial and real estate investing blogosphere regarding the single-member LLC. Some people seem to think they are completely worthless, while others prescribe them like aspirin for headache. However, as is almost always the case, neither extreme is correct. Single-member LLC’s have their place in the spectrum of business entity choices, and whether such an entity is right for you will depend on the details of your own personal situation. As the name implies, a single-member LLC is simply a limited liability company with one owner (member), instead of multiple owners. Single-Member LLC Pros 1) Asset Protection: as is the case with any LLC, the single-member LLC will act as a shield to protect your personal assets from the liabilities associated with the business conducted by the LLC. For example: if your LLC owns a rental property, and someone slips and ... Read more
    1. Make an S-Election on an LLC you set up this year and used for Operations– This is a unique trick we implement for several clients each year. If you previously paid a lot in Self-Employment Tax and for some reason had an LLC (sometimes a major mistake by other planners), you can easily still elect it to be taxed as an S-Corporation retroactively to January 1st, 2013. However, don’t forget to do your payroll (see the next strategy…you can’t pull this off in the spring without completing the payroll portion in Strategy 2 below). 2. Set YOUR Payroll Amount– If you have an S-Corporation, C-Corporation OR LLC-taxed as an S-Corporation, it’s critical you nail down your payroll before year-end. A lot of people wait until 4th quarter to do their payroll, which is not a good idea, unless you want to get nasty letters and a potential audit from ... Read more
    This is a common question we are asked on a regular basis and an important one. In fact, it tends be a common concern with Canadian clients doing real estate projects in the U.S. Here are some basics that can help you if you are a foreigner or investing with a foreign partner. Why an S-Corporation in the first place? It’s no secret that an S-Corp is a fantastic entity for U.S. real estate investors rehabbing, fix and flipping or wholesaling properties. Moreover, it’s perfect for consulting, selling a product or getting commissions. The S-Corp can be phenomenal to save on Self-employment tax. Thus, it’s no surprise that many foreigners will often hear or read about the benefits of an S-Corp and wonder if this is the right choice for them. Some Foreigners don’t need an S-Corporation? Understanding that S-Corps save on Self-Employment tax, it then begs the question: ... Read more
    Some business owners who want to save on employment taxes treat employees like contractors and 1099 them rather than set up payroll with a W-2. BEWARE!! I certainly understand you want to save money in this area of your business, employment taxes, workers comp, unemployment, etc… can be a pain AND expensive. However, just because you ‘say’ they are a sub and give them a 1099, doesn’t make them a sub-contractor. Basically, if they walk like a duck, act like a duck and look like a duck… they’re a duck!!! I’m sorry. Here are the two concerns we need you to know about: First, the IRS is cracking down on this practice. As reported in the New York Times “Federal and state officials, many facing record budget deficits, are starting to aggressively pursue companies that try to pass off regular employees as independent contractors.” The IRS consistently warns taxpayers that ... Read more
    A Strategic Plan is very different from a Business Plan. A Strategic Plan sets forth a timeline of specific tasks that need to be completed in order to make your Business Plan a reality. It’s a specific list of objectives to reach specific goals. This time, more than any time of the year is a perfect time to revisit our Strategic Plan, or build one if we don’t have one. Even experienced business owners can benefit from using a Strategic Plan as an integral part of their business. It is so difficult to manage all of the loose ends and chaos that can occur when running a small business. A Strategic Plan helps tremendously. A Strategic Plan is essentially a checklist of things that need to be completed in the next month, 3 months, 6 months, and 12 months. It takes your business plan to the next level when you ... Read more