Signs That You Need a Transaction Manager
Jack Butala: Signs That You Need a Transaction Manager. Every Single month we give away a property for free. It's super simple to qualify. Two simple steps. Leave us your feedback for this podcast on iTunes and number two, get the free ebook at landacademy.com, you don't even have to read it. Thanks for listening.
Jack Butala:
Jack Butala here for Land Academy. Welcome to our Cash Flow from Land show. In this episode, Jill and I talk about the signs that you might need a transaction manager, like a property transaction completion manager. Jill, great show today. Before we get to it though, let's take a question from a caller like we always do.
Jill DeWit:
Sure. Okay. Kelly from Sacramento called in and asked, "Are there tax issues I need to be aware of in this business?" Great question. I wonder if she's saying that because she's in California and because there's always different things in California. You know how that goes.
Jack Butala:
We get a lot of tax questions.
Jill DeWit:
This is kind of your area.
Jack Butala:
I guess, a valid concern.
Jill DeWit:
Aren't you an accountant?
Jack Butala:
No, I'm not an accountant.
Jill DeWit:
I'm just kidding.
Jack Butala:
I used to be a sort of accountant.
Jill DeWit:
I'm teasing.
Jack Butala:
You know what's funny about when you tell people, "I have an accounting background," everybody assumes that I just sat around and did tax returns for an H&R Block, which is ...
Jill DeWit:
That's why I like to tease you. I think it's funny.
Jack Butala:
There's so much more in accounting than taxes. No, I'm in by no stretch a tax expert or an accounting expert. I do know a little bit about buy-and-sell and real estate, just like you do though.
Jill DeWit:
You do.
Jack Butala:
Are there tax issues? No. I'll give you my spiel here. I think she's talking about income tax issues versus property tax. We're going to assume that. No. It's not treated any differently than any other business. There's property gains, the capital gains taxes versus ordinary income. There's a lot of stuff like that, but we're long past those issues. People who use those terms are usually at my age or older. The taxes have gotten a lot more simple.
I will give you some pre-advice. The way that Jill and I have structured it ... I've structured it in my whole career this way is that I always take a salary. Even an incredibly small salary, always take one, so that you have some W-2 income to report every year. That's a very, very healthy way to do this. Get with an accountant to make sure that you manage how you're expensing your business expenses and whether you need more or less to maximize how you're utilizing your taxes.
Jill DeWit:
Awesome.
Jack Butala:
Tax is not a bad word. Everybody's just, "Oh, tax." You can make taxes really work towards your benefit in a lot of different ways. This is not a tax show and I'm not an expert, but get a good accountant, like anything. We did a show recently about hiring experts. Getting a tax person and a bookkeeper and an accountant is no different.
Jill DeWit:
I love it. I think that's the big thing is it seems scary for a bit. You just got to say, "No, it's okay. It's not scary." Like you just said, dude, there's a couple of other things you should consider. When you don't have the right team person working with you, don't even think about it.
Jack Butala:
I'll tell you this. For people who have had a job for their whole lives and then they start a company like this or any kind of company, they're shocked and amazed how little taxes you actually pay versus just being a W-2 employee somewhere.
Jill and I have 2 very, very, very successful friends who work for a very large company, an international company. They make together pretty close to half a million bucks a year.