Anderson Business Advisors Podcast
Anderson Business Advisors Podcast
Tax Tuesdays Episode 93: Private Lending
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Are you and your friends getting the runaround from accountants, attorneys, and others charging for tax advice? Toby Mathis and Jeff Webb of Anderson Advisors set you straight and answer your tax questions. Do you have a tax question? Submit it to taxtuesday@andersonadvisors.

Highlights/Topics:

  • If somebody inherits property through a probate, how can you avoid capital gains? When someone dies, capital assets step up to fair market value and costs $0 in capital gains   
  • What are typical percentages of improvement value for the cost segregation of personal property for 5, 7, and 15 years? About 20%, if property is less than 20 years
  • If someone sells inherited real estate for less than appraised value, can they take a tax loss? Depends, but usually not on personal use property
  • What constitutes being a real estate professional? 750 hours of professional time in real estate and material participation in real estate activities
  • If I move to a different state, does my LLC need to be registered in new home state? Depends, if LLC is separate entity/location, it doesn’t need to be registered in new state
  • Does a home-based business help with lowering taxes and need to be incorporated? Does allow some deductions, if business is profitable; doesn’t need to be incorporated
  • Can I change my LLC taxes from one year to the next? Yes, but some limitations exist
  • Can an LLC be recategorized from a sole proprietorship to C or S Corp in mid-year? Yes, but there are rules to follow and tax forms to complete      
  • If you’re doing an online business, such as an app, does LLC need to be in your own home state? No, if only doing interstate commerce
  • Is equity stripping a necessity in real estate asset protection? Yes, stops lender and others from getting entire equity from your property
  • What is the 199A deduction? 20% deduction on qualified business income
  • If I start private lending to individual investors, is it possible to take the 199A deduction? Yes, maybe; if designated as specified service
  • What’s the definition of dealer? What are the ramifications? Depends on your intent when purchasing the property; dealer buys something to sell it, investor buys and holds it   

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Resources

Types of Wills and Trusts

Using Cost Segregation in Residential Real Estate

Bonus Depreciation

How to become a Real Estate Professional for Tax Purposes

Howard Spiva (Attorney)

Tax Cutting Jobs Act (TCJA)

Home Office Deduction

Form 2553

Section 199A

1099-INT

Section 121 Exclusion

1031 Exchanges: 10 Things to Know

Toby Mathis

Anderson Advisors

As always, take advantage of our free educational content and every other Tuesday we have Toby’s Tax Tuesday, another great educational series. Our Structure Implementation Series answers your questions about how to structure your business entities to protect you and your assets. One of my favorites as well is our Infinity Investing Workshop.

Additional Resources:

Full Episode Transcript

Toby: Hey guys, this is Toby Mathis.

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