Finding A CPA Who Knows Real Estate Tax Laws

Tax Act

Finding a Certified Public Accountant, or CPA, who knows real estate tax laws is essential, whether you are a big investor or a small time homeowner. Why is it so important to seek out a qualified CPA? For starters, look at the U.S. Tax Code. This monstrosity spans millions of pages, and is a construct of the early 20th Century. Over the years it has grown and grown and grown, till the point that it is unstoppable, sort of like in that old horror movie “The Blob.” And many ordinary Americans are equally terrified of it. They are, because they hear scary stories all the time about the Internal Revenue Administration and the harsh punishments for tax evasion. They are afraid that if they do not know the millions of pages, they will be punished in a severe financial or even legal way.

Who can blame them? If you gave one tax return to 10 different CPAs, they would probably come up with 10 different final numbers. (Maybe 11.) How is the ordinary American supposed to make sense of all this and fulfill the requirements as set forth by law? The best way is to actually find that quality CPA and put him to work for you. There are countless benefits that a CPA can bring to the table:

1. Screw-ups do not have to be blamed on the client.

If something goes wrong, it is not necessarily your fault. All you really have to do is bring all tax related documents, and you have the ammunition that you need to get things done. If there is an error of entry, then you have a record to protect you.

2. Good CPAs give you peace of mind.

You could go on worrying about those CPA mixups, but the truth of the matter is they don’t happen that often. Most of the time, CPAs know how to work within the confines of the tax code better than you would be able to.

3. Good CPAs will make you more money than they cost you.

This one is very true. While you may be able to do your taxes yourself, it will cost you much in time, and you will likely still not find all the things out there that can be used to your advantage. While a CPA will charge you for the work they do, they are relieving you of the mental burden and usually finding higher amounts of money for a return, so that you still come out ahead.

With all the reasons to try a qualified CPA, why wouldn’t you want to? The tax code is too complicated to go it alone, and you have too much to lose otherwise.

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Tips for Tax Lien Investing

Tax Act

When it comes to tax lien investing, there are several tips you need to keep in mind. First of, it would be better to buy liens at smaller countries. The individuals who are bidding for large companies to invest their money in tax lien certificates are institutional bidders. Since there will be less liens to go around, it’s possible they won’t bother to attend tax lien sales at smaller countries. Besides, the liens may also be smaller.

If you buy smaller liens, then you may get higher interest rate because there will be less competition. It would also be advisable to stay during the off times of a sale. Prime examples of these are lunch breaks, end of the day, and last day of a sale. When you catch the people asleep, then you can get the good liens.

Also, try to go up to the clerk and ask if there are any more liens for sale. This is very important because there are investors who will purchase too many liens and at the end of the day, they’ll realize that they can’t afford to purchase all of them. These will not be re-auctioned by the county. For this reason, most will sell them to you over the counter at the maximum percentage interest.

Setting max bid amounts is another thing you should do. Don’t hesitate and wait until the bidding has settled and the bidders have dropped off. Afterwards, you can go for the decent sized increase but don’t forget your limits. It would also be a good idea to buy from company names that you recognize. Buying from commercial properties would mean that the liens will definitely redeem.

Remember that in tax lien investing, you put your money into tax liens that are created by county governments. Large sums can be provided but you may also face risks. A great tip would be to understand the risks before getting involved in this market.

Investing in tax liens is lucrative. That’s because you can get higher returns unlike in traditional forms of investment. If you foreclose on the property and sell the house, then the returns can be amplified. But as mentioned earlier, this isn’t a foolproof investment and it could be difficult to get your money back if the IRS has a lien on the property or if the homeowner files for bankruptcy.