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Passive Real Estate Tax Strategy & Knowledge with Thomas Castelli
Investing with Taylor: www.investwithtaylor.com
Stessa to manage your properties: https://stessa.sjv.io/c/2425882/1152983/14113
Thomas Castelli, a CPA and real estate taxation expert, joins the Passive Wealth Strategy Show to discuss the tax implications and advantages of passive real estate investing. He explains the importance of understanding the K-1 tax form that passive real estate investors receive and highlights key information to know before receiving one. Thomas also delves into the topic of self-directed retirement account investing and the potential tax implications involved. He emphasizes the need to find a tax professional experienced in real estate taxation and provides tips for vetting a CPA. Additionally, Thomas addresses the concept of not letting the tax tail wag the dog and making holistic investment decisions. He concludes by discussing the complexities of UBIT (unrelated business income tax) and the challenges of preparing a 990T form for self-directed IRA investments.
Key Takeaways:
The K-1 tax form is crucial for passive real estate investors as it shows their share of income, losses, deductions, and credits from the partnership.
It is important to find a CPA experienced in real estate taxation and who understands K-1s and the specific needs of real estate investors.
UBIT (unrelated business income tax) can impact self-directed IRA investments, but the overall impact is usually minimal and primarily occurs when the investment is sold.
When investing through a self-directed IRA, it is essential to be prepared for the additional compliance requirements, such as filing a 990T form.
The tax implications should be considered as a factor in investment decision-making, but they should not be the sole driving force behind investment choices.
Quotes:
"Real estate is one of the more complicated areas of the tax code, and there's a lot going on, and there's a lot that can be missed." - Thomas Castelli, CPA
"Make sure you review your return before you file it, and if you do end up catching a mistake after the fact, it's not uncommon." - Thomas Castelli, CPA
"I prefer to invest in real estate outside of retirement accounts for the tax advantages and keep other investments like stocks in IRAs." - Thomas Castelli, CPA
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By Taylor The InvestorInvesting with Taylor: www.investwithtaylor.com
Stessa to manage your properties: https://stessa.sjv.io/c/2425882/1152983/14113
Thomas Castelli, a CPA and real estate taxation expert, joins the Passive Wealth Strategy Show to discuss the tax implications and advantages of passive real estate investing. He explains the importance of understanding the K-1 tax form that passive real estate investors receive and highlights key information to know before receiving one. Thomas also delves into the topic of self-directed retirement account investing and the potential tax implications involved. He emphasizes the need to find a tax professional experienced in real estate taxation and provides tips for vetting a CPA. Additionally, Thomas addresses the concept of not letting the tax tail wag the dog and making holistic investment decisions. He concludes by discussing the complexities of UBIT (unrelated business income tax) and the challenges of preparing a 990T form for self-directed IRA investments.
Key Takeaways:
The K-1 tax form is crucial for passive real estate investors as it shows their share of income, losses, deductions, and credits from the partnership.
It is important to find a CPA experienced in real estate taxation and who understands K-1s and the specific needs of real estate investors.
UBIT (unrelated business income tax) can impact self-directed IRA investments, but the overall impact is usually minimal and primarily occurs when the investment is sold.
When investing through a self-directed IRA, it is essential to be prepared for the additional compliance requirements, such as filing a 990T form.
The tax implications should be considered as a factor in investment decision-making, but they should not be the sole driving force behind investment choices.
Quotes:
"Real estate is one of the more complicated areas of the tax code, and there's a lot going on, and there's a lot that can be missed." - Thomas Castelli, CPA
"Make sure you review your return before you file it, and if you do end up catching a mistake after the fact, it's not uncommon." - Thomas Castelli, CPA
"I prefer to invest in real estate outside of retirement accounts for the tax advantages and keep other investments like stocks in IRAs." - Thomas Castelli, CPA