Use your CPA for more than your tax return! We are happy the lion’s share of our clients have CPAs but what is troubling is that all too often this valued professional finds out out about their client’s annual activities only when preparing the tax return…
Your CPA is a valuable member of your investment team, his or her value is increased dramatically when allowed to plan ahead instead of merely compiling information after potential tax event. So often the planning process is skipped in the interest of cost though good tax planning can dramatically change the effectiveness of an investment.
Whether an item gets expensed or capitalized, what allocation is given to improvements or dirt, and whether a property is depreciated and at what term are just a few examples of items that can be treated in different ways. Any one of these items will change the basis and income of a property.
In conclusion it’s not enough to have professionals on your team, you must use them!