Posted Monday, February 19th, 2024 by Enterprise Property Management
Tax-Savvy Investing – How CPAs Elevate Your Real Estate Game: Aaron Ivey delves into the indispensable role of Certified Public Accountants (CPAs) in real estate investment. Guest Cameron Spivey, a seasoned CPA and tax puzzle enthusiast, shares his journey from academic to tax expert, emphasizing the creative and personalized approach he brings to tax planning. Spivey’s insights reveal how CPAs not only navigate the complexities of tax law but also empower investors with strategic decision-making tools. Through Spivey’s expertise, listeners gain a comprehensive understanding of how effective tax planning and CPA collaboration can significantly enhance their real estate investment success.
Aaron
0:00:19 – Thank you for joining us on the Behind the Curtain Podcast. This is Aaron Ivey. I’m really excited about today, largely because there are so many questions that we’re going to discuss today that I personally don’t have the answers to, and I always refer our investors to the proper professional to answer those professional questions. And today it’s all about certified public accountants and their role in real estate investment.
Sponsorship
0:00:53 – Behind the Curtain Real Estate Podcast is sponsored by Memphis Real Estate Advisors. Memphis Real Estate Advisors is a realtor team led by husband and wife duo Aaron and Alyssa Ivey. Bringing over 20 years of experience in both residential and commercial real estate sales and property management. The team works with investors, buyers, and sellers as a member branch office of the national franchise EXP Realty. To get in contact with Memphis Real Estate Advisors, visit them online at memphisreadvisors.com or call 901-671-1015.
Aaron
0:01:25 – So I get a lot of questions all the time from investors about CPAs and accounting and business structures and they ask me a lot of questions that I’m simply not licensed and certified to answer. So what exactly will a great CPA do for you? Well, that’s why I’ve invited our guest on today. His name is Cameron Spivey He’s a longtime friend of enterprise property management and of mine And he’s also currently our CPA here at enterprise property management and my own personal CPA So Cameron, thank you so much for coming on our show.
Cameron
0:01:56 – Aaron. Thank you. Thank you for having me. Let’s start from the beginning.
Aaron
0:02:41 – Absolutely Cameron can you tell us just a little bit about yourself?
Cameron
0:03:10 – First off, I am a lifelong learner and what I enjoy doing is getting up the next day and learning the next piece of information. I tend to be more of an academic. More than anything, I love to work puzzles. And at present and for the past several years, what I enjoy doing is working the tax puzzle. And I’ve gotten really good at it, enjoy it. As far as what I was born to do, I was born to teach, I was born to do social work, and I was born to do ministry. And my parents cried the day that I told them that I changed all of my classes to accounting because they thought that was a terrible waste of the talent that I’d been given to teach. But all I do with my clients is I learn the law, I learn how to apply the law, I learn how to custom apply the law to them, and then I teach them. Because I want my clients to know everything I know about them and their taxation. They’ll make better decisions on a day-to-day basis. They’ll know when to pick up the phone and call me, and we can make better decisions together. And more than anything, enjoying singing and being an actor, those are gifts that I have and I can use those but I pull the creativity from that type of activity and I apply it to taxation. I love working the puzzle. I love turning it on its head and reconfiguring it and finding the optimal structure for every client. You can’t make a lot of money doing it that way but there is a huge amount of satisfaction in delivering a product to a client and helping a client tax plan and avoid excess tax.
Aaron
0:03:41 – You know everything you said is is something that I’ve watched and witnessed in your life over the years and and you’ve benefited a lot of people and uh and for the listener Cameron and I have been long-time friends but recently within the last two years I’ve hired him to be my CPA on all levels. And one of the reasons, and this is such an important point, one of the reasons that I hired Cameron is because he’s exceptionally more innovative and mindful of what it is that I’m trying to do professionally and personally. One of the great things about Cameron is he will allow me to do the five minute phone call or I’ll say, Hey, you know, text him and say, Hey, do you have a second for a quick chat today? And I’ll say, yeah. And he’ll, he’ll give me a five minute chat or he’ll often know exactly what I’m looking for from his desk, be able to produce it for me and then send it over to me in my inbox. You may interact with his wife, but you will have access to him. It’s not like you have to go through a number of people to get to Cameron. That’s a major plus with working with you.
Cameron
0:04:37 – Thanks, thank you Aaron, appreciate that.
Aaron
0:04:45 – Yeah, yeah, and the other cool thing is I’ve already started to work with some of Cameron’s clients and in working with those clients, they have the same working relationship with Cameron that I do. So I can confidently say that what you’re gonna hear on the podcast today is very indicative of what your experience could be with Cameron should you choose to hire him. I’m using Cameron to set the bar for you as you are considering who to hire for the role of CPA. So this is the gold standard, y’all. I mean, please pay attention, because some of the questions that Cameron’s gonna answer today, if you’re interviewing other CPAs in your state or whatever, you need to be asking these same questions and looking for comprehensive and knowledgeable responses from your CPA so that you can know you’ve hired somebody that’s gonna hopefully do a good job for you. So Cameron, just a few more questions for you personally. How long have you been practicing as a CPA?
Cameron
0:05:36 – I’ve been out and practicing as a CPA since 1986, so I’m not going to date myself on this one.
Aaron
0:05:42 – You may have.
Cameron
0:05:43 – In fact, yeah, I may have. I think one of the big questions, Aaron, is, well, how long are you going to keep practicing? And the answer is, CPAs tend to find themselves face down in their pizza the day after they retire. So do you think I’m going to retire? No. No. While the brain’s working, while I can work the puzzle, and while I can help people you’ll find me at work love to love to Assist currently how many clients are you assisting? We’re currently built to handle about 500 clients We’ve expanded our practice. And so we’re we’re probably taking we’re looking to expand another 250 at this point, okay And a lot of the limitation, the reason we’re not at 1,500 clients is because of the type of custom service that we give. We purposely have pretty much limited our growth. It’s what I call say and do. If I say that we’re going to do something, we need to complete it.
Aaron
0:06:38 – A really interesting thing about working with Cameron and about working with some of his clients is that they tell me that they’ve experienced the same generosity and the same sort of family feel that you provide me. You are completely invested in all of your clients. You don’t treat your responsibilities lightly.
Cameron
0:06:55 – Well, you know, my profile is social worker and so, you know, yeah, and so that really does pepper my work, really does season it. And so, you know, I’ve got to be true to that, which means you may never ever become a widget in my practice. You’re always custom. You’re a culinary masterpiece.
Aaron
0:07:19 – I love that. I love that. And one of the things that I hope you get to develop as we move forward is Cameron, over the nearly 40 years of practicing, talks about his work as art. You have some some terms that you use. What is one of those?
Cameron
0:07:33 – That’s really it. It is an art form to actually solve a tax return in a custom manner, you know, a solution that’s specific to you, instead of just getting a standard format. If you get an attorney and they pull out the boilerplate contract and then bill you for it, you feel sort of slighted. You want something that addresses your issues specifically in the contract. And I want to follow suit with those attorney practitioners, those counselors that really take good care of their clients. We want to do the same in the CPA practice, in the CPA industry.
Aaron
0:08:11 – What would you say is your specific focus and specialization? What do you find yourself being just exceptional at? We already know that relationship is the foundation, the context, but in the tax world and in accounting, like where is it that you just, you know, you’ve got it nailed?
Cameron
0:08:27 – We’ve worked pretty much with every industry in the, in the last 40 years. And so I find myself gravitating to the real estate industry. I’m seeing wealth built. I’m also seeing wealth lost in the, in the real estate industry. And I want to help my clients be on the winning side of that equation. And so a lot of interest in real estate. In fact, I guess you’d say out of the 1,700 returns that I signed last year, about 1,200 of those were real estate returns. When you get a lot of looks like that at real estate tax returns, whether it’s company returns or individual returns that are related to those companies, it’s a lot like Keanu Reeves in The Matrix when he’s practicing jiu-jitsu and all those different forms of martial arts. You see him yawning and not even thinking about it. It just comes so naturally to him. Once you’ve done a hundred, you start to see patterns. Even though each return is custom, about 80% of those returns tend to follow certain patterns. And you start looking for those. You can predict them. In fact, when somebody turns in information and it’s missing information, you know it immediately because it doesn’t fit the pattern. It’s the 20% customization though that really makes the difference in the return.
Richard
0:09:48 – So one of the questions I’d like to ask as a new investor, if I was to come to you as a CPA, as a new investor, how would you advise me? What questions do we need to consider?
Cameron
0:09:59 – Richard, I’d go to my top five. I would want to know, I’d want to start first with how you formed your business, the structure of your business. That’s very important. When we’re talking about the structure, you know, there are several considerations. There’s a risk management or a liability that’s got to be addressed and that’s for an attorney to do. Your insurance advisor is going to help you manage some of your risk as well. And then when you’re talking about taxation, it is possible that your attorney has advised you to use a structure to limit your risk that also creates an issue for us on the tax side that’s hard to recover from. Okay? In other words, you may end up paying some more tax. So there’s some give and take and you just have to measure what’s most important to you. Okay? What do you stand to lose? If you have a strong asset base inside the company or personally, you definitely need to address that risk, that you could lose that as you do business. So you’re doing the right thing to consult with an attorney to cover that. However, in that structure, you may end up paying more tax or you certainly may be inflexible, okay? So when it comes to tax time and we’re working your custom puzzle, I would like to make a change. Well, the structure that you’ve adopted may prevent me from helping you do that. Okay? And so now you got to pay more tax. other words, you may end up paying some more tax. So there’s some give and take and you just have to measure what’s most important to you. Okay? What do you stand to lose? If you have a strong asset base inside the company or personally, you definitely need to address that risk, that you could lose that as you do business. So you’re doing the right thing to consult with an attorney to cover that. However, in that structure, you may end up paying more tax or you certainly may be inflexible, okay? So when it comes to tax time and we’re working your custom puzzle, I would like to make a change. Well, the structure that you’ve adopted may prevent me from helping you do that. Okay? And so now you got to pay more tax.
Cameron
0:11:28 – Whereas when Aaron and I are talking and Aaron comes to me and says, what business format should we adopt and is it possible to go back and adopt a format for something that’s already happened? And we say, yes, yes, and we’re working through that. We’re going to adopt one that at least addresses the liability, but at the same time gives us all the flexibility that we need. In many cases, our go-to entity is going to be an LLC. When it comes to residential real estate, when it comes to commercial real estate, we may adopt a general partnership and go get some insurance. Okay? Because we have the partners are completely exposed in the general partnership from a risk standpoint. Every partner, every partner is responsible for their partner’s role. So if your partner goes out and commits, you’re responsible. Consult with a CPA on your formation. Also consult with your attorney. Then you’re gonna make the best decision and try to blend it and get what you need, okay? The other thing is, you really need to have a set of books and records. You need to start making sure that you’re tracking the information that you plan to report to the IRS. Also, you need to know, am I winning or losing? You know, you need to track that. If you’re spending more than you’re making, you need to know that and you need to budget for that. The other thing is, many of my clients, I get on to them. If they buy or sell anything, $2,000 or more, I want to know about it. And I’d love to know about it before they do it. So they need to loop me in on that. They also need to notify me if they’re thinking about bringing in a partner. And I will warn them, be careful, because those don’t always end well. In fact, most of the time they don’t. It’s a lot like software installations. Those usually fail 80% of the time, so you’ve got to be prepared. Another thing that they miss is 1031 transactions.
Aaron
0:13:28 – Cameron, this is, you were talking about top five. This is a first-time investor, major question, because they often have a property that they’ve inherited that they’re thinking about liquidating. It’s gone through probate. It’s not theirs. They don’t want it anymore, but they want to take the proceeds and they want to move it without capital gains. Anytime anybody asks me this, I say, let me find you a professional that you can speak with and I don’t want to waste your time. I want you to get the answers that you need from somebody who’s qualified to answer those questions. So please, please proceed.
Cameron
0:13:58 – No, I guess that point number, you know, I’m counting down 5, 4, 3, 2, 1 and this is number 2, is they may be aware and they may attempt to conduct a 1031 exchange, but they may run afoul of it. We call it a 1031 bust. They lose the opportunity to actually tax report in a 1031 exchange because they missed one of the rules. And so we want to assist them, we want to make sure that they’ve followed those rules. We’re not necessarily going to be the qualified intermediary, but we need to make sure that they get one, and we need to make sure that they understand the rules, that they follow them. It’s not the end of the world if a 1031 exchange goes bust. We’ll pay some capital gains, but the goal is is to kick the can down the road, defer paying the tax as long as possible, and maybe even hold the property until I expire because death is the best tax planning tool. I die and my heirs inherit the property at a stepped up value and it restarts the clock. The final point that I would refer to is most of the clients that are in real estate don’t fully understand the benefits of being a real estate professional and don’t use those. That is huge, it’s a game changer. In fact, Richard, I think earlier on before we started our discussion today, you were asking some questions, and I love those questions, the questions about what configuration works best with a real estate professional. Does the other spouse need to have a W-2? And so we were talking about those types of configurations, how to really have a win in regard to the real estate professional classification. Those are the top five that I would add. Oh, there’s so many more. And there’s so many more ways to save tax.
Richard
0:15:55 – So I think one of the things I really got from what you just said is you’ve kind of set $2,000 as an argument as you know if you’re making a financial decision that’s $2,000 or more you really need to call your CPA first.
Cameron
0:16:09 – Yeah and not everybody’s going to do that Richard.
Richard
0:16:11 – No I appreciate that but as a way to think.
Cameron
0:16:14 – It’s a stressor you know it’s saying look if it’s important to you you need to be calling your CPA absolutely. For some people $2,000 is a walk in the park they don’t need to call me on that. But most of my clients would like to know how to structure whether they’re buying, selling, any type of transaction that involves their money and a gain or establishing basis. Okay, or trading property, exchanging property. I need to be involved in all those things. We need to talk it through and talk about what their path is going to be, and they get to pick. Because the most important thing is to never let the tax tail wag the dog, right? All we’re trying to do is put icing on this cake. They’re baking the cake. They’re going to make the big decisions. And so we’re just going to help them make it taste a little better.
Aaron
0:17:10 – One of the things I want to make sure that the listener knows that Cameron has described just now that he’s done for me and I’ve had a great deal of satisfaction in this step that you’ve taken is to get to know not only who we are right now but also to take a look at our previous three years of taxes. It was really really important for Cameron to become more aware more familiar with who I am and what I was trying to accomplish by seeing how my previous CPA was handling my taxes, handling my expenses, giving me direction on or corporate formation or type of corporation. He will do this for anybody that comes to him and says, hey, I’m thinking about making a change, I don’t know if my current CPA is taking good care of me. I met with Cameron and Cameron looked over my books before I hired him. Not every CPA is gonna do that. They’re gonna say, okay, here’s my onboarding fee, I need you to bring me all this information, I’ll get back with you in three months. Cameron was back to me in a week and a half. We got the top five out of the way. What else is it that you want to share?
Cameron
0:18:12 – We could spend the whole show exploring the top five if you want. I came prepared to do that, but I want to answer the questions that you have at this point, Aaron. I think that would be, you know, that’d be good for our listeners because your perspective is key in this podcast. You’re representing your listeners. They trust you and they trust you to ask the right questions. So I’m going to trust that too. Okay, let’s go.
Cameron
0:18:41 – How many states are you licensed to practice in?
Cameron
0:19:06 – Well, currently I’m licensed to practice in one. I currently practice in all 50. Can you explain that? At the present, all of the states actually accept my Tennessee license and allow me to practice. I’m practicing in Tennessee and I’m preparing federal returns. So the federal returns really have no state. But when we’re dealing with state returns, right, if I was actually going into a state to perform consulting work, you know, I would need to consult with that state and make sure that I was properly licensed, okay. At present, I work with tax clients and I serve tax clients from all 50 states and each state has its issues and you got to be aware of those. And so those are just 50 more puzzles I get to work. I love it. We solve the federal puzzle and then we move on to how that impacts the state and we’ll go back and make adjustments on the federal return if we can have a positive impact on the state.
Aaron
0:19:41 – So outside of Tennessee Mississippi and Arkansas which all border we share a border What would be the next state where you have the most clients, California? Okay I think that’s great for our listeners to hear most of our investors that we work with are in California on some level or are adjacent to California an interesting thing about why Californians do business in Memphis is because the level of opportunity in Memphis is massive. When you compare real estate prices in Memphis, Tennessee to just about everywhere in California, there is huge opportunity here in Memphis. And so Californians fled here, they fled into Nashville, Atlanta, all kinds of smaller communities as well. So Cameron has the language and the understanding and the experience to be able to help you invest in property in Memphis.
Cameron
0:20:27 – Yeah, and if you just happen to be living in China, I take care of those for you. Brazil, Uruguay, Paraguay, Argentina. We’ve got clients all over the world that are investors in the Memphis market, and they found us, that’s how they found us. They actually work with a real estate professional, and the real estate professional
Cameron
0:20:44 – would point them our direction, and we take great care of them. I don’t believe we’ve lost a single client over the course of my practice that for an international client, they love us.
Richard
0:20:52 – You actually just brought up the question I was going to ask you about, we have so many overseas listeners, what would be the difference from an overseas investor versus someone who was a resident of the United States?
Cameron
0:21:04 – No, that’s great. The overseas investors usually will have their own country of residence, they’ll have taxation there And then we work on the U.S. impact on their income, right? So many times we’re dealing with an LLC or a corporation or in a lot of cases they’ve invested in the U.S., a portion of their retirement package is invested. And it’s set up usually as a limited partnership or an LLC. And so we work with them to make sure that they stay compliant, that they don’t lose their business interests because they’re non-compliant. Another issue that comes up with international folks, this is a heavy issue, the U.S. government, anytime you sell property and you’re an international, the government says, well we don’t trust that you’re going to file all your returns, so at the closing table we’re going to take 15% of your gross proceeds and hold it. And you may never see it again. A lot of folks who own property internationally, if they’re not prepared for that, if they let it time out, they may just lose access to those funds. And the government takes it into income. In most cases, they should not have had to pay the full 15%. They didn’t know it. And so we get in on the front end of those transactions, they call me before they transact, and we prepare to make sure that they’re not going to lose that 15%. It used to be a higher number. The and hold it. And you may never see it again. A lot of folks who own property internationally, if they’re not prepared for that, if they let it time out, they may just lose access to those funds. And the government takes it into income. In most cases, they should not have had to pay the full 15%. They didn’t know it. And so we get in on the front end of those transactions, they call me before they transact, and we prepare to make sure that they’re not going to lose that 15%. It used to be a higher number. The government did adjust that to 15%.
Aaron
0:23:04 – I got to jump in, you know, if you are an international investor, you need to be speaking with Cameron because he just dropped some truth in this room that we didn’t even know to ask that question and Richard I don’t know if you can tell was not born in the United States so matters of international business are of specific curiosity to him and I don’t think you’ve heard that before have you know that specific fact about 15% now it’s called for Richard for the whole world for that that’s a acronym for you got to FERPTA.
Richard
0:23:39 – So that’s a handy acronym. What does that stand for?
Cameron
0:23:39 – Oh, I knew you were going to do it. That’s, that is a, it’s a federal, oh goodness. You know, I’ve said FERPTA for so long, I’ll have to look it up. I love that. I love that. It’s an international tax for an international who’s selling property. It’s a property tax is what it is.
Aaron
0:23:42 – And so in our experience, you know, we’ve been around for about 22 years. We started working with international investors about, I guess about 15, 16 years ago. And we have a big Chinese following. We have a big Japanese following. I would say between those two countries alone, 40 investors and that continues to grow. And so the reason these investors are investing in the United States in real estate is because the potential of a great return. For our Japanese investors that invested between 2013 and 2016, they had at the very least a 100% return on their investment. And that’s in cash flow. I mean, that’s in profit. Now, most of these Japanese investors, just so that you know, and Japanese investors, if you’re listening, please pay attention, they haven’t sold their properties yet. Uh oh. Yeah, so they’re still holding these properties and if they don’t have foreign CPA adjacent advice in their country, in their home country, then they could stumble into that mistake. And so I would just encourage international investors who have invested in real estate or any other real asset in the United States to please call Cameron. We’re going to give you his contact information at the end of the show.
Cameron
0:24:48 – Okay, and just so you know, let’s get out of the acronym FERPTA, and that’s defined as Foreign Investment in Real Property Tax Act. That’s what it is. So just like a 1031 exchange, 1031 is just the section in the tax code. That’s all 1031 is. Well, in this case, Foreign Investment in Real Estate Property Tax Act is the name, and long ago, we just started calling it FERPTA. That’s what it stands for.
Aaron
0:25:15 – Do you see there being more controls exercised by the IRS in monitoring and or taxing foreign investment in real assets in the United States in the in the coming years?
Cameron
0:25:27 – Oh absolutely. In fact what you just saw this last year was the government actually and this is outside of real estate okay this is overall financial financial transactions, the government has been monitoring anything over $9,999. Anything that moves to the $10,000 mark, they want to know about it. In fact, it’s gotten to the point now, anything over $500, they’re looking at those numbers because they’re looking to get to the root of funding for terrorism. Real estate property proceeds, they want to know where that money is going and who is benefiting from those proceeds. Because a smart investor whoactually is funding something they shouldn’t be funding with two or three steps can actually get funds where they want them to go and the government won’t be the wiser. That’s not true. The government is watching everything. Well, they have an apartment, Fensen, and Fensen now says, you know, we really don’t know who owns these LLCs, who owns these partnerships, and who the shareholders of the corporations are. We want to know more about this. So let’s start with the partnerships, and everybody needs to report. We need to know who owns what. They’re now requiring CPAs. If they’re working with an attorney and an entity is formed, we’ve got a report within 14 days to the government. It’s a crimes unit is what it actually is funding something they shouldn’t be funding with two or three steps can actually get funds where they want them to go and the government won’t be the wiser. That’s not true. The government is watching everything. Well, they have an apartment, Fensen, and Fensen now says, you know, we really don’t know who owns these LLCs, who owns these partnerships, and who the shareholders of the corporations are. We want to know more about this. So let’s start with the partnerships, and everybody needs to report. We need to know who owns what. They’re now requiring CPAs. If they’re working with an attorney and an entity is formed, we’ve got a report within 14 days to the government. It’s a crimes unit is what it is. It’s a financial crime unit. Wow. And they’re combing through that looking for possible offenders. Not only are we doing that and then for anybody that had their entity created before 2024, we’ve got till January of 25 to get that report turned in to the government. And we don’t want to be on the wrong side of that law because when Fenton comes looking for you They’re looking to convict. This is not a settlement like working with the IRS you turn in your tax return. They agree disagree We get a negotiated settlement of what that number should be. That’s all administrative This is a crimes unit and they are looking for you So we want to be forthright transparent and we want to make sure that we comply with everything that we’re asked to give. Anyway, very serious, very serious activity going on.
Richard
0:27:47 – One of the things I always like to ask of our guests is, do you have any funny anecdotes? I mean what’s been the best puzzle that you’ve worked on where you’ve really felt you’ve made a difference?
Cameron
0:27:52 – Oh, this is great. Actually, just recently had a neurosurgeon come to me when the neurosurgeon was just hoping not to owe any more tax. They’d had a really good year and so when we came back to them and they were getting a $200,000 refund, they’re saying what? What just happened? And what we had to do was we had to go back through you know last three years of returns, we found some errors. And when you find an error in taxation, you either amend the previous return or in some cases like depreciation, you would correct it on the current return when you find it. We were able to really move that needle and of course, what do you think came out of that? Referrals. That’s the way that works? but they need me desperately, and there’s nobody standing in the gate taking care of them, and that’s my job.
Aaron
0:29:34 – I would agree with that as well. I think we all give away our services, and I can say this for Richard as well. I’ve watched him work with people in their need to expand their company presence online. I’ve watched him give free advice as well and so and we do the same thing with real estate. In fact of the three of us at this table I think I probably speak to more people than both of you combined and give them advice and they never hire me. That is a huge compliment to me that they would call me that they would feel like this is the advice that I need right and they’re gonna call Aaron and get that advice but just like you guys I don’t require that they do business with me, I want them to, but it’s not a requirement. So one of the questions that I had, there’s so many questions, we hope that you can come back for a part two later and we’re gonna become, we’re gonna get more granular with things. I would love to just get a little bit of an idea about business structures, you know, we talked a tiny bit about that, but people are gonna have questions, so we’re actually going to probe our listeners, get some questions, and come back with those listener questions. I think that’s gonna be great for everybody to hear what is on their minds. And honestly, listener, here’s the thing. I’m a conservative person financially. I’m very, very conservative. I love to save money. When people look at my balance sheet and they look at my company balance sheet and they say, wow, that’s a lot of cash you’re keeping on hand. You should do something with that. I need people like Cameron to know my tax situation, know my cash flow situation, and then he doesn’t tell me what to do but when I ask and I say well I have this and I have this and you know what my income was last year and what it’s likely to be this year, what do you think I do with this cash? And Cameron frees me to be able to move money around to where it makes the most sense and it gets me the greater return.
Aaron
0:30:44 – So the thing is I didn’t know what to ask for and you were talking about the neurosurgeon earlier that’s such a great organic point. What does a neurosurgeon do for a living?
Richard
0:30:52 – We don’t know that’s why they do it.
Aaron
0:30:54 – That’s right. I have no idea. I don’t know how to do brain surgery. I don’t understand brain surgery. I’m not interested in performing brain surgery. So Cameron is the same exact way. If you don’t have a CPA and you’ve been soldiering on and shouldering the burden of your own accounting and tax preparation every year not knowing the extent of the tax code not knowing the extent to which you can benefit from the tax code as an investor you’ve got to find a CPA you’ve got to and hopefully one that has high character and one that you trust and as Cameron said he operates in all 50 states and internationally so.
Cameron
0:31:26 – Now Aaron we would say about tax accounting and about accounting and taxation that it’s not neuroscience right that it’s not neuroscience but the other day was on the phone with a gentleman out of Colorado. He just happened to be in and out of NORAD quite a lot. And so he had a lot of stuff going on and I’d have to kill anyone. I told the rest of the story. I won’t tell you that, but I did make a point. I was trying to explain taxation to him and I told him it wasn’t rocket science. He said, I’m a rocket scientist. So he said, I think I’m following you here. So anyway, it’s just a comment about the, it’s not neurosurgery. Well, I quit using that terminology and I quit using the terminology about being a rocket scientist because you never know who you’re talking to sometimes.
Aaron
0:32:15 – You don’t, and I’ll repeat one of the things that I learned from a certified financial planner, a long time friend. He told me when I was just opening my business, he said, here’s where your value is, Aaron. You’re going to do for your customers so that they can go do what they do for themselves. In other words, they have a life to live. If I did your job just for me, I would work as hard as Cameron works 1,500 customers just trying to figure out my own tax situation. I don’t have time for that and that doesn’t make me money. And so I’m grateful and glad to be able to hand that information over to you and know that you’re doing that so that I can go do what I do.
Cameron
0:32:50 – Aaron, just a real quick reconciliation. For those of you that are mathy, you probably picked up, I told you I had 500 clients, but I signed 1,700 returns. There’s a discrepancy there. So 500 of those clients are my direct clients, and 1,200 of those I consult with another CPA firm who has a real estate specialty, and I review and work with and sign those returns and advise those clients. So that’s how I get the number up to 1,700 returns signed last year.
Aaron
0:33:22 – I’d also like to convey something that we haven’t said yet. Just like enterprise property management is a family business and several members of my family are involved, Cameron’s business is also a family business and so there’s something really genuine about having your wife work with you and both of our wives work with us. You also have a daughter that’s working with you as well.
Cameron
0:33:41 – Actually, she’s graduated. She now works with, uh, with the CPA that I do the consulting with. She’s now working with this firm, but I have a cousin in Nashville who ran a firm for her father in Nashville and her father passed. And so that firm joined us and she joined our practice. Yes, I have my wife, myself and my cousin in Nashville and it works very well.
Aaron
0:34:04 – That’s fantastic. Well, Cameron, I’ve really enjoyed having you on today. Is there anything else that you want to convey just in general before we leave off on this episode because hopefully you’re coming back and we’re going to get a little bit more granular.
Cameron
0:34:15 – Yeah. We didn’t get to the hot subject that I want to talk about. Hopefully we’ll get a chance to talk about it next time. I have seen several presentations, listened to several podcasts, and CPAs are telling potential clients that the best way to save money, the best structure for saving money is an S-corp and I want to address that because that’s not necessarily the case. So would love to talk about that maybe we can address that in a future session.
Aaron
0:34:41 – The knowledge that you bring regarding corporate structure and Cameron is knowledgeable about all corporate structures and how they’re taxed and so we’re going to talk about that in an upcoming episode. Give us a couple of weeks, we’ll have Cameron back. He’s in his busy season. We didn’t acknowledge that. It’s February the 2nd, and so you know what Cameron’s doing right now and what he’s going to be doing all the way up until April the 15th, and then somewhere midsummer, it just starts all over again.
Cameron
0:35:06 – That’s right.
Aaron
0:35:07 – Cameron, where can people find you? Like, have a telephone number that people can freely reach you at?
Cameron
0:35:12 – Oh, absolutely. Best way to reach us is at our main number. It’s 901-881-5010. That’s the best way to reach us.
Aaron
0:35:39 – I am Aaron Ivey, Realtor President, Principal Broker here at Enterprise Property Management, Broker for Memphis Real Estate Advisors, Brokered by eXp Realty. And you can always reach me at 901-671-1015. And coming up here pretty soon, you’ll actually be able to chat with our team on our website. The main one investors go to is propertymanagementmemphis.com. I really look forward to chatting with you, answering your questions, and I love that we’re going to have Cameron back on to talk more about the things that investors really need to know and also to bring you investor questions. So thank you so much for being on with us.
Cameron
0:36:17 – Thank you, Aaron. Thank you, Richard.
Richard
0:36:20 – Thank you.
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