January 23, 2024

How to Structure a Residential Assisted Living Business

1 hour 21 minutes

Welcome back to another engaging session of Tax Tuesday from Anderson Business Advisors, where your pressing tax queries meet expert insights! In this episode, host Toby Mathis, Esq., welcomes regular guest Eliot Thomas, Esq., Manager of Tax Advisors at Anderson Business Advisors. This week, we explore the benefits of strategic corporate partnerships in investments, the allure of residential assisted living businesses, and the unique tax considerations for collectibles like wine. Submit your tax question to taxtuesday@andersonadvisors.

Highlights/Topics:

If I purchase a vehicle in 2023, primarily for my business, is there a percentage I have to use for business versus per personal to deduct the amount I paid for I paid cash. and how will that affect other depreciation and such for my business? I guess I'm asking what is the best way to deduct this? -the better solution for our clients is often using just a standard mileage reimbursement and that or deduction in the case of a sole proprietorship.

With bonus depreciation being reduced to 40% next year and 20% the year after that, then ending in 2027, what are the alternatives for investors who have been using bonus depreciation through real estate purchases to reduce taxable income? - the first step before you get there is you're doing cost segregation.

I have an LLC C Corp with an accountable plan including medical reimbursements good. I have a high deductible insurance plan and an HSA better. Would it make sense to use the medical reimbursement from the C Corp for uncovered medical expenses instead of paying With the HSA, letting the HSA continue to grow? - So the simple, direct answer is yes and yes, you can do that. You can have the medical reimbursement and an HSA.

I have owned a residence for 10 years. I lived in it for the first year and then rented it out. We have recently moved back into it and want to live there for at least two years so as not to pay tax when we sell it. I will potentially profit about 350,000 and am married. Is this a wise action of 76 years old? I plan on moving into our other rental at that time and perhaps selling it after two years there. - Remember you did rent it out for nine years. You had depreciation and if you didn't take depreciation you will be treated by the tax code as if you did.

I am a real estate professional and bought many real estate homes the rental homes from 2018 to 2022. My account and encouraged me not to use my real estate professional status to depreciate faster. Now I regret it. Should I just do amended returns? I paid a lot of taxes that I could have avoided in those years. - There's a form 3115 and that has to be done on a timely file original return. So we can't amend and go back and do that. But what we can do is go back and look at the related cost segregations

I have a partnership set up with my stock trading management company. Does it still make sense to distribute income to my trading management company, structured as a C-corp, for taxes if most of my trading gains this year will actually be long-term capital gains and therefore would actually be taxed at a lower rate than the corporate rate? - we don't know specifically with your situation, but more than likely there's still benefit to doing so.

How do you determine the best structure for a residential assisted living business that will be located in Florida and Georgia, buying the home and running it to the business? –if we had the business and it owned the home, you always run the risk of having someone like me being in that business and I sue you and I take the whole thing. I take the house and the business. So we separate.

What are the tax implications of investing in wine? This is for clint. Yeah, that's going to say it doesn't count if you drink at all. Right, all right. For example, like using a platform like vino vest, I made 20-something percent last year in my whiskey, yes, and I don't even drink much. Is One able to write off losses from the sale of wine or offset these losses against taxes owed? Any sort of tax loss harvesting way interesting. - this is a 28% bracket and it's called collectibles. This is gonna be your art, your fine alcohols and things like that, and so there actually is a unique category of capital gains for this…

Is there a difference between filing taxes with an October deadline Versus an April deadline? If yes, what are the advantages or disadvantages of each? -we are always gonna recommend that you extend, and that would extend your April deadline out to October. Gives you more time to clearly see what's going on and it gives you more time to get all things properly put into place.

Resources:

Tax and Asset Protection Events

https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=how-to-structure-a-residential-assisted-living-business

Anderson Advisors

https://andersonadvisors.com/

Toby Mathis YouTube

https://www.youtube.com/@TobyMathis

Toby Mathis TikTok

https://www.tiktok.com/@tobymathisesq

Clint Coons YouTube

https://www.youtube.com/@ClintCoons

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