{"id":10255,"date":"2023-12-16T04:40:48","date_gmt":"2023-12-16T04:40:48","guid":{"rendered":"https:\/\/imsfund.com\/?p=10255"},"modified":"2023-12-16T04:40:48","modified_gmt":"2023-12-16T04:40:48","slug":"with-two-weeks-left-in-2023-nows-the-time-to-get-your-taxes-in-order","status":"publish","type":"post","link":"https:\/\/imsfund.com\/index.php\/2023\/12\/16\/with-two-weeks-left-in-2023-nows-the-time-to-get-your-taxes-in-order\/","title":{"rendered":"With Two Weeks Left in 2023, Now\u2019s the Time To Get Your Taxes in Order"},"content":{"rendered":"<p> <br \/>\n<\/p>\n<div :class=\"{ 'hidden': $store.proContent.showFullPrompt() }\">\n<section class=\"px-4 relative border border-slate-200 mobile-toc lg:hidden\" x-data=\"{open:false}\">\n<button x-on:click=\"open = !open\" class=\"flex items-center gap-4 my-2 border-none w-full\"><br \/>\n<svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"h-6 w-6\" fill=\"none\" viewbox=\"0 0 24 24\" stroke=\"currentColor\" stroke-width=\"2\"><path stroke-linecap=\"round\" stroke-linejoin=\"round\" d=\"M4 8h16M4 16h16\"\/><\/svg><\/p>\n<p class=\"font-semibold text-slate-800 text-base m-0 js-toc-ignore\">In this article<\/p>\n<p><\/button><\/p>\n<\/section>\n<p><span data-preserver-spaces=\"true\">With 2023 coming to a close, it\u2019s the best time to get ahead of your taxes. Get with your tax professional, figure out where you stand, and then make some final moves that could save you big bucks when it comes to tax time in a few months. Make sure you know exactly what your options are before you run out of time to do something about it.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">We talked to two expert real estate CPAs and asked them what they are advising clients to do, and importantly\u00a0<\/span><em><span data-preserver-spaces=\"true\">not\u00a0<\/span><\/em><span data-preserver-spaces=\"true\">do, in these last few weeks of the year.<\/span><\/p>\n<h2 class=\"wp-block-heading\"><span data-preserver-spaces=\"true\">Timing is Everything<\/span><\/h2>\n<p><a class=\"editor-rtfLink\" href=\"https:\/\/www.instagram.com\/amanda_han_cpa\/\" target=\"_blank\" rel=\"nofollow noopener\"><span data-preserver-spaces=\"true\">Amanda Han<\/span><\/a><span data-preserver-spaces=\"true\">\u00a0is a real estate CPA and tax strategist and the author of\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/store.biggerpockets.com\/products\/the-book-on-tax-strategies-for-the-savvy-real-estate-investor\" target=\"_blank\" rel=\"nofollow noopener\"><em><span data-preserver-spaces=\"true\">The Book on Tax Strategies for the Savvy Real Estate Investor<\/span><\/em><\/a><span data-preserver-spaces=\"true\">\u00a0for BiggerPockets. She invests all across the U.S.<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">BiggerPockets:\u00a0<\/span><\/strong><span data-preserver-spaces=\"true\">What should investors be looking to do at the end of the year to prep for taxes?<\/span><\/p>\n<p><em><span data-preserver-spaces=\"true\">Some of the things investors should look at with respect to year-end is [thinking about] the timing of a transaction. For example, if you are close to closing on a sale that will have a lot of gain, consider deferring that income into Jan. 1 of next year. By delaying the close of that transaction for even just a few days, you can defer the taxes for a whole entire year.\u00a0<\/span><\/em><\/p>\n<p><em><span data-preserver-spaces=\"true\">The opposite applies for expenses. If you need some expenses to offset this year\u2019s income, consider prepaying some of those recurring items before the end of the year to accelerate the write-off into this year.<\/span><\/em><\/p>\n<p><em><span data-preserver-spaces=\"true\">Even payments charged on a credit card by year-end can be potentially tax deductible. You may not need to have paid off the credit card [for it to count for tax year 2023<\/span><\/em><span data-preserver-spaces=\"true\">].<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">BiggerPockets:\u00a0<\/span><\/strong><span data-preserver-spaces=\"true\">What should investors avoid?<\/span><\/p>\n<p><em><span data-preserver-spaces=\"true\">One thing investors should avoid is spending money just for purposes of tax deductions. In other words, if it\u2019s not something you need, don\u2019t pay for it just because you may get a tax benefit.<\/span><\/em><\/p>\n<h2 class=\"wp-block-heading\"><span data-preserver-spaces=\"true\">Be Proactive and Communicate With Your Tax Professional<\/span><\/h2>\n<p><a class=\"editor-rtfLink\" href=\"https:\/\/www.instagram.com\/beachwoodbuyshouses\/\" target=\"_blank\" rel=\"nofollow noopener\"><span data-preserver-spaces=\"true\">Danielle Rutigliano<\/span><\/a><span data-preserver-spaces=\"true\">\u00a0is a CPA and real estate investor based in Long Island, New York. She is the owner of a boutique CPA firm that specializes in bookkeeping, tax planning, and tax preparation for real estate clients throughout the U.S. As an investor, she\u2019s scaled her portfolio to a little over 40 units in New York, Indiana, and Tennessee in three years.\u00a0<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">BiggerPockets:\u00a0<\/span><\/strong><span data-preserver-spaces=\"true\">What should investors be looking to do at the end of the year to prep for taxes?<\/span><\/p>\n<p><em><span data-preserver-spaces=\"true\">Investors should be talking to their CPA, who specializes in real estate, before the end of the year to discuss\u00a0<\/span><\/em><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/real-estate-846\" target=\"_blank\" rel=\"noopener\"><em><span data-preserver-spaces=\"true\">last-minute tax-saving opportunities for 2023<\/span><\/em><\/a><em><span data-preserver-spaces=\"true\">.\u00a0<\/span><\/em><\/p>\n<p><em><span data-preserver-spaces=\"true\">They should discuss frequently missed\u00a0<\/span><\/em><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/rental-property-tax-deductions\" target=\"_blank\" rel=\"noopener\"><em><span data-preserver-spaces=\"true\">deductions<\/span><\/em><\/a><em><span data-preserver-spaces=\"true\">, such as the home office deduction, business use of cell phones, and gifts. They should also discuss if they qualify for the\u00a0<\/span><\/em><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/on-the-market-96\" target=\"_blank\" rel=\"noopener\"><em><span data-preserver-spaces=\"true\">short-term rental loophole<\/span><\/em><\/a><em><span data-preserver-spaces=\"true\">\u00a0or\u00a0<\/span><\/em><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/real-estate-professional-status-save-money-on-taxes\" target=\"_blank\" rel=\"noopener\"><em><span data-preserver-spaces=\"true\">real estate professional status<\/span><\/em><\/a><em><span data-preserver-spaces=\"true\">\u00a0for 2023. If the taxpayer has children, they should discuss with their CPA if it\u2019s beneficial to pay their kids to help them in December for an additional deduction before year-end.\u00a0\u00a0<\/span><\/em><\/p>\n<p><em><span data-preserver-spaces=\"true\">Investors should keep their books organized and avoid waiting until the last minute to catch up, as this leads to missed deductions.\u00a0<\/span><\/em><\/p>\n<p><em><span data-preserver-spaces=\"true\">Investors who purchased properties in 2023 should talk to their CPA to see if they can benefit from getting a cost segregation study done on their property, which would allow them to utilize bonus depreciation to maximize rental losses.\u00a0<\/span><\/em><\/p>\n<p><em><span data-preserver-spaces=\"true\">Investors should consider prepaying for expenses or services in 2023 to maximize deductions if they are a cash-basis taxpayer. This could be insurance, real estate taxes, or other property-related expenses.\u00a0<\/span><\/em><\/p>\n<p><em><span data-preserver-spaces=\"true\">Investors who have active real estate businesses, such as\u00a0<\/span><\/em><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/what-is-a-real-estate-agent\" target=\"_blank\" rel=\"noopener\"><em><span data-preserver-spaces=\"true\">real estate agents<\/span><\/em><\/a><em><span data-preserver-spaces=\"true\">,\u00a0<\/span><\/em><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/guides\/how-to-flip-houses\" target=\"_blank\" rel=\"noopener\"><em><span data-preserver-spaces=\"true\">fix-and-flip investors<\/span><\/em><\/a><em><span data-preserver-spaces=\"true\">, and\u00a0<\/span><\/em><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/wholesaling-strategy\" target=\"_blank\" rel=\"noopener\"><em><span data-preserver-spaces=\"true\">wholesalers<\/span><\/em><\/a><em><span data-preserver-spaces=\"true\">, should find out from their CPA if they would benefit from paying themselves a reasonable salary in December to reduce self-employment tax.\u00a0<\/span><\/em><\/p>\n<p><strong><span data-preserver-spaces=\"true\">BiggerPockets:\u00a0<\/span><\/strong><span data-preserver-spaces=\"true\">What should investors avoid?<\/span><\/p>\n<ul>\n<li><em><span data-preserver-spaces=\"true\">Waiting until the last minute to finalize their 2023 bookkeeping.\u00a0<\/span><\/em><\/li>\n<li><em><span data-preserver-spaces=\"true\">Working with a tax preparer who does not understand the tax code for real estate clients.\u00a0<\/span><\/em><\/li>\n<li><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/commingling\" target=\"_blank\" rel=\"noopener\"><em><span data-preserver-spaces=\"true\">Commingling<\/span><\/em><\/a><em><span data-preserver-spaces=\"true\">\u00a0business and personal expenses.\u00a0<\/span><\/em><\/li>\n<li><em><span data-preserver-spaces=\"true\">Putting rentals in S-Corps\u00a0<\/span><\/em><\/li>\n<li><em><span data-preserver-spaces=\"true\">Investors should try to avoid selling properties at a gain before year-end: They should try to push the closing to 2024 so they have a full year to plan to minimize the tax impact of that gain.\u00a0<\/span><\/em><\/li>\n<\/ul>\n<p><strong><span data-preserver-spaces=\"true\">BiggerPockets:\u00a0<\/span><\/strong><span data-preserver-spaces=\"true\">What are some strategies you wished more people utilized?<\/span><\/p>\n<ul>\n<li><em><span data-preserver-spaces=\"true\">I wish more investors took advantage of real estate professional status because it is a very powerful strategy for tax savings.\u00a0<\/span><\/em><\/li>\n<li><em><span data-preserver-spaces=\"true\">Proper entity structuring is important and can save taxpayers significant costs. Putting properties in the wrong entity is a very costly mistake, and setting up a rental portfolio structure incorrectly can result in excessive tax preparation costs.\u00a0<\/span><\/em><\/li>\n<li><em><span data-preserver-spaces=\"true\">Bonus depreciation is also a very powerful tool. I hope that more investors work with their CPA to see if they can benefit from doing a cost segregation study.\u00a0<\/span><\/em><\/li>\n<\/ul>\n<div id=\"hero-block_62ee867235a1c\" class=\"first:mt-0 hero-block py-4    has-background has-slate-300-background-color has-text-color has-slate-800-color\">\n<div class=\"gap-10 lg:gap-20 flex flex-wrap lg:flex-nowrap max-w-screen-xl mx-auto px-4 relative lg:items-center \">\n<div class=\"relative z-30 lg:w-2\/3 \">\n<main class=\"py-4\"><\/p>\n<p class=\"has-theme-slate-color has-text-color has-large-font-size\" style=\"font-style:normal;font-weight:800\">Dreading tax season?<\/p>\n<p class=\"my-3 md:my-5 lg:my-8 has-theme-slate-color has-text-color\" style=\"font-size:16px\">Not sure how to maximize deductions for your real estate business? In <em>The Book on Tax Strategies for the Savvy Real Estate Investor<\/em>, CPAs Amanda Han and Matthew MacFarland share the practical information you need to not only do your taxes this year\u2014but to also prepare an ongoing strategy that will make your next tax season that much easier.<\/p>\n<p><\/main>\n<\/div>\n<div class=\"lg:w-1\/3 first:mt-0 relative h-full lg:flex lg:items-center\">\n<img decoding=\"async\" class=\"object-cover w-full relative z-20 my-0  rounded-md hidden lg:block\" src=\"https:\/\/bpimg.biggerpockets.com\/https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2023\/04\/tax-strategies-books.png\" alt=\"tax strategies books\" title=\"With Two Weeks Left in 2023, Now\u2019s the Time To Get Your Taxes in Order 2\"\/>\n<\/div>\n<\/div>\n<\/div>\n<p class=\"italic\"><b>Note By BiggerPockets:<\/b> These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.<\/p>\n<\/div>\n<p><script async src=\"\/\/www.instagram.com\/embed.js\"><\/script><br \/>\n<br \/><br \/>\n<br \/><a href=\"https:\/\/www.biggerpockets.com\/blog\/now-is-the-time-to-get-your-taxes-in-order\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In this article With 2023 coming to a close, it\u2019s the best time to get ahead of your taxes. Get with your tax professional, figure out where you stand, and then make some final moves that could save you big bucks when it comes to tax time in a few months. Make sure you know [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":10256,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"fifu_image_url":"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2023\/12\/taxes-1024x517.jpg","fifu_image_alt":"","footnotes":""},"categories":[9],"tags":[],"class_list":["post-10255","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"_links":{"self":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts\/10255","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/comments?post=10255"}],"version-history":[{"count":1,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts\/10255\/revisions"}],"predecessor-version":[{"id":10257,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts\/10255\/revisions\/10257"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/media\/10256"}],"wp:attachment":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/media?parent=10255"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/categories?post=10255"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/tags?post=10255"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}