Mon, 25 May 2020
In this episode, I am joined by Amanda Han. As a CPA, tax strategist, and real estate investor, Amanda Han combines her passion for real estate investing with her expertise in tax tactics. Her goal is to help investors with tactics designed to supercharge their wealth-building using entity structuring, self-directed investing, and income offset opportunities to keep more of what they make.
Amanda begins by giving us a little bit of her background. She talks about how both her parents and grandparents were real estate investors but encouraged her to follow the more traditional route of getting an education, followed by a good job. She began her accounting career at Deloitte, just by chance, in their real estate specialty group. She realized very quickly some of the tax benefits her investor clients could take advantage of, increasing their income while not necessarily working a ton of hours.
Amanda explained that the majority of real estate investors are not aware of the tax strategies available to them. She pointed out that it isn’t necessarily anyone’s fault but that the tax codes are written in a convoluted way. Reaping tax benefits requires very specialized knowledge for each and every industry.
I asked Amanda to explain a little about what is going on with the tax situation during the current COVID-19 pandemic. She said as part of the Cares Act pandemic relief package, the new filing deadline is July 15th. Most of the states are following these guidelines, and Amanda recommended getting more information from AICPA State Tax Filing Guidelines.
I wanted to find out Amanda’s recommendations for newer or smaller investors on when a good time is to begin working with a CPA and employing tax strategies. She said it was important for even brand new investors to consult advisors in order to form to proper legal entities necessary for both tax benefits and protection, and also how to use them effectively.
I asked Amanda to explain a strategy that I have recently become familiar with which is cost segregation. She said first that one of the things that is so attractive about real estate investing is the depreciation that can be claimed no matter how much is put down on the house or other factors. Cost segregation is just the next level of this type of tax advantage. It involves defining all of the components of a particular investment property, not just the building itself. Some of these components may be eligible for an immediate deduction, providing the possibility of taking a higher deduction upfront rather than having everything depreciate over the standard timeframe.
Amanda went on to explain strategies that could benefit some types of real estate investors but not others, giving specific examples. She also gave some great, practical advice on how to determine whether an individual’s tax advisor was helping employ these strategies.
I then asked Amanda about the charity that she and her husband and business partner, Matt, formed named Animals for Armed Forces Foundation. The foundation helps to place shelter animals with current or retired servicemen and women. Normally on Memorial Day and Veteran’s Day each year they will work with local shelters to place animals in military homes for free, while the foundation pays for any necessary fees. Amanda talked about how rewarding it is to receive pictures of these pets in their new homes with their forever families.
We then talked about the two books they have written on tax strategies for real estate investors (see links at the bottom). She said that she and Matt read a lot of books about taxes benefits for investors and found them difficult and dull to read and wondered how people who were not CPAs would get any useful information from them, so they wrote their own books to help people find strategies that could help them. The first book is story-based about specific successes and mistakes made by investors and provides actionable, easy-to-understand advice about various tax schemes.
If you are like me, you may not know much about taxes, but please join me for this interesting, motivating, and believe or not, fun interview with tax expert Amanda Han!
“I think there is a misconception that investors think they only need to work with a CPA or an attorney when I have ‘X’ number of rentals.”
“It is more transaction-focused rather than a number of rentals in terms of who could benefit from tax planning.”
“In the tax world, there is never a one-size-fits-all strategy.”
“In the spirit of Michael Scott, now say it like I am a four-year-old.”
“Flipping burgers - not nearly the upside of flipping houses.”
“Our firm specializes in proactive tax planning.”
“We have people whose tax preparer is their father-in-law… you can’t fire your father-in-law.”
“We always recommend this team-of-advisors approach, where we are all working together.”
“I like talking to people that do good things, good people who aren’t just business, business, business, cutthroat - people who care.”
“I don’t like not knowing, but I just don’t know, so thank you for telling me your book is basically for dummies.”
“Our goal in writing the book was to show people what can be done.”
Direct download: Real_Estate_Tax_Strategy_-_A_Proactive_Approach_to_Higher_ROI_with_Amanda_Han.mp3
Category:general -- posted at: 3:30am EDT
Mon, 18 May 2020
For this episode, I interviewed friend and fellow 7 Figure Flipper Dana Mace. She begins by talking about her background and how she began in real estate investing. Dana said that because her step-dad owned one of the largest, privately-owned real estate businesses in Virginia, investing this way was just part of their family culture. She bought her first property at the age of 21 years old and hasn’t looked back since.
Dana was born and raised in Virginia Beach and this metropolitan area is where her business is focused. She and her husband started their newest company, Ubiquitous Properties, with the goal of scaling their flipping business to 60 each year. Dana explained that they picked the name Ubiquitous because it means “omnipotent; all over, everywhere” and that is their objective. We discussed the markets in our prospective areas and what an average deal sold for.
We talked about different strategies for getting on wholesalers’ lists and what was really successful for Dana in her market. She also shared with us how she evaluates her deals. Dana also gave us an idea of the key people she wants to have as part of her team so that she can scale up to a particular level.
Dana shared some of the struggles she has been dealing with this year, but how determined she is to push through and make her business succeed. In order to raise some capital, they pulled off a 7-day flip, and Dana describes what that experience was like.
Next, I wanted Dana to talk about why she started her YouTube channel and what its purpose is. She said that she thinks that the best way to scale something and to learn is just to talk about it. She had initially intended to show a lot of before and after house-flipping situations but was encouraged to put on more varied real estate content, as well.
Join me for this super fun, upbeat and honest interview with fiery real estate investor Dana Mace!
“I knew that real estate was the thing to go into.”
“If anybody wants a tip, tell them to buy real estate.”
“I have been very fortunate to have people surrounding me my whole life that know a lot about real estate so that I have been able to learn and grow.”
“I knew I wanted to do something cool with my life and something cool with my money.”
“I just wanted to flip it. I am just flip-happy sometimes.”
“No one understands completely how well you are doing because you are just a ninja and crushing it, just doing your thing and not making a big deal about it.”
“When life “lifes” on you, what are you gonna do?”
“Life makes its move, and sometimes it feels like ‘Check.’ It is only ‘Checkmate’ when you give up.”
“Find the people that are good at things that you are not.”
“The number one thing that has made the biggest difference in my business is getting out of my own way, realizing what I wasn’t good at, quit lying to myself about it, and bring someone in that could handle that for me.”
“What does scaling really look like to me? Being better tomorrow, a little bit better than what you were today.”
Direct download: Scaling_a_Flipping_Business_and_Investing_in_Multi-Family_Properties.mp3
Category:general -- posted at: 3:30am EDT
Mon, 11 May 2020
In this episode, I had the pleasure of interviewing multi-family property investor Teghena (Tenny) Tolofari. Prior to establishing Xsite Capital Investment in 2019, Tenny spent several years leading a major sales force in one of the fastest-growing financial services companies in America. He is also a Global Cyber Security professional supporting the likes of Boeing and Deloitte. Tenny’s major role is building relationships with brokers, property management companies, and investors to ensure the success of their property investment business.
Tenny began by sharing the story of his humble beginnings as a child in Nigeria. He was initially very insecure about his abilities and did not do well in school. Because of the class system in Africa, Tenny realized the only way he could break out of the poverty of his youth was to immigrate to the United States. He made a bet with his mother in which she told him she would find the means to send him to graduate school in America if he could finish college with high honors. That motivated Tenny to get to work and accomplish this goal.
Upon arriving in the States, Tenny began his graduate degree in Management Information Systems at Virginia International University and then transferred to Bowie State University. After graduation, even though he had great jobs and was able to bring his family over to the U.S. from Nigeria, he continued to ask himself, “What’s next?” He then began to learn about finance and it opened up a whole new world to him.
Like so many other budding entrepreneurs, Tenny started self-educating by reading Rich Dad Poor Dad and Rich Dad’s Cashflow Quadrant by Robert Kiyosaki. He found that the financial service platform gave him the opportunity to start his own business and work with others with more experience. During this process, he met his partner, Leslie Awasom. After discovering they were reading many of the same financial freedom books, they began their working relationship by meeting at a brewery to play the Cashflow 101 Board Game. Because Leslie already had a real estate investing company, they decided to merge their business efforts in January of 2019.
Tenny talks about how both he and Leslie were very invested in educating themselves and went to many financial and real estate boot camp and mastermind events. They decided they were going to focus their real estate ventures in the multi-family market and bought their first property, a 192 unit apartment building in Marietta, Georgia. This year, they are looking to expand these efforts.
I asked Tenny how he feels when he hears people born in this country talk about how they don’t have the same opportunities as others and can’t afford to improve their situation. Tenny said it used to make him mad because he believes those are just excuses for not improving yourself, but then realized you can only be who you surround yourself with. We discussed how important it is to appreciate and use what you have and encircle yourself with good people. Tenny talked about the sacrifices he had to make, yet how driven he was to succeed.
Tenny then explained what syndication is because that is what he primarily deals with in his business. He explained the difference between the two business classifications that they have, 503B and 503C, as far as dealing with investors. He also detailed why they decided to go into multi-family real estate investing rather than other options. He gave several examples of the advantages of owning multi-family including spreading out expenses such as management companies and adjusting for vacancies. Tenny also detailed their philosophy for finding and funding deals.
We talked a lot about different ways to build relationships and how important this is in real estate investing. Tenny said one of the strategies that they have when trying to enter a new market is to talk to the property management companies first in order to get an in with the big brokers in that area.
I hope you join me as I get to know this dynamic investor and fantastic human being who built a successful real estate business from nothing with self-education, hard work, and desire!
“You can only be what you surround yourself with.”
“Everyone has the opportunity - it’s just how badly do you want it and what are you going to to to get there.”
“I know what I want. I didn’t want that life, like so many of my friends back home, that are struggling to take care of their family.”
“A lot of people don’t appreciate what they have. They just don’t understand.”
“Gratitude and perspective are things that can help people change.”
“People change due to two things: desperation or inspiration. Mine was both.”
“I’d never done commercial real estate before… I just had to put myself out there and learn.”
“And this is one of my superpowers that I know God blessed me with - I can pick up the phone and call anybody.”
“It’s got to be deeper than that… you’ve got to mean it.”
“There’s a lot of things going on in the world right now, a lot of people are scared, but you don’t stop, don’t freeze, keep moving.”
Tenny’s Phone Number: (202) 569-5072
Direct download: From_humble_beginning_to_success_in_multifamily_investing.mp3
Category:general -- posted at: 3:30am EDT
Mon, 4 May 2020
For this episode, I have invited four of my friends and fellow real estate investors to talk about their specific market experiences thus far during the COVID-19 pandemic. I asked each of them to introduce themselves and tell us a little bit about their business.
Adam Rae lives in Colorado Springs and operates his business in southern Colorado. His business works in wholesaling, flipping, and rental properties.
Andy McFarland lives in Utah and is also involved in wholesaling, flipping, and owns rentals in three different markets: Salt Lake City Utah, Albuquerque, NM, and Indianapolis, Indiana.
Jeremiah Johnson runs his business remotely from his home just outside of Denver and does primarily wholesaling in the markets of Wichita and Kansas City.
Terry Burger does business in the markets of Atlanta Georgia and Greenville, South Carolina, performing primarily flips.
We began by discussing our different states and markets and the limitations we are seeing with the varied stay-at-home orders and how that has immediately affected our businesses. With the US economy impacted so severely by the pandemic, we all shared our projections about the real estate market going forward. We also considered how the different facets of the business could be influenced by the response of buyers, sellers, and lenders. We talked about different ways we have all implemented some cost-saving measures internal to our businesses, as well.
This episode is filled with “actionable intelligence” that will benefit investors of all kinds, in any state of business development.
“History does not repeat itself, but it often rhymes.”
“Real estate is the local perception of a national opinion.”
“Our asset class is looking pretty sexy right now.”
“We’re not going back to living in tents anytime soon.”
“Real estate is a slow-moving animal and you aren’t going to miss the boat if you don’t buy something tomorrow.”
“I think your grandma’s economics still work here… live on less than you make, invest the difference, have cash reserves, have staying power.”
“I wrote down “actionable intelligence” - I absolutely love that and need to make it part of my vocabulary.”
“It is important to develop empathy and not ego through this.”
Direct download: Real_Estate_vs_Coronavirus_-_Round_Table_Discussion.mp3
Category:general -- posted at: 3:30am EDT