Tag: accredited

https://youtu.be/FTj-nJEGi-4

So what if I have an asset, I did a cost segregation. I shipped that all the passive losses and I slide that asset into profit. Do I have to give up those passive losses personally or no? Passive loss is in the year that it’s earned. So the same way you can be a real estate professional in one year and a non real estate professional, just a regular passive investor.

 

Is the same way those losses get locked on your return. There is something called disposition of the asset where you can unlock those losses and they become ordinary losses. So the one thing we would look at is whether that disposition would qualify. If we transferred into a nonprofit, the other reason that deal might be slightly different.

 

Is that while there’s no issues with putting in straight line depreciation property into a nonprofit, as far as the value, when you put in property where you’ve accelerated the depreciation that accelerated depreciation, just the five, seven and 15 year property gets subtracted from the fair market value.

 

So if I bought a property for 500,000 and I wrote off a hundred thousand in year one, And then the property goes up to a million bucks and I transfer it into the nonprofit. I would take the a hundred thousand dollars of accelerated depreciation and I would subtract it from the million. So I’d get a $900,000 deduction.

 

And you’ve mentioned it earlier, but is it essentially you can load assets into the nonprofit just as long as it’s not luxury or what about like class, a office space that don’t work as long as it’s passive? What the nonprofit, the only thing the nonprofit worries about is when I have an asset, whether it’s used for my charitable purpose, for example, I don’t like private foundations where they’re not doing anything.

 

All they do is give money to other nonprofits. We’ve done them, but I much prefer things that are actually doing stuff. And people don’t realize how wide open that is. The example I give people that usually makes them go. Hunt is Ikea and Ikea is a nonprofit. Always has been. The majority owner, the majority control is actually two different charities.

 

And then the kids of Inbar the guides set it up for still control about a third of the board. So they, nobody can get rid of that company in it. He is very, almost no tax. I think it was about 4%. When you operate an ordinary business than a nonprofit, there’s something called UBIT that you have to be worried about unrelated business income tax.

 

And if you’re leveraging the asset, there’s always the possibility of unrelated debt financing, but it’s a misnomer. We don’t really worry about it because there’s still depreciation that we get to use against it. So even if it did make that. You’re probably going to be paying to somebody anyway, like you’re gonna be paying it out as a salary or another expense.

 

Like you’re not more than likely you’re not going to get hit by anything. If you did you pay a little tax on it, but the charity pays it. I must admit, like from an asset protection standpoint, you’re pretty solid there. Nobody could ever take it away. That’s the thing, things, nobody owns it. It’s for the public benefit, you control it.

 

So if you run over a bus load of nuns, you get sued, but lightening suit out of you, they can’t touch it. They could take your, if you start paying yourself out of salary, they can garnish some of those wages. But even that’s 25% of a wage. So it’s not like they could just. Go in there and they can’t touch the asset.

 

And then you control. Usually what people would do under that scenario is they’d pay somebody else, a spouse or a child, and they would take care of that individual, but it just takes the bowl, the bullseye off your forehead. When you have a lot of assets in your walk around with them in your name, I just say you’re attempting fate.

 

There somebody is good inside. They’re going to make their bones on trying to take your stuff. So you, do you like the strategy in new of, or it conjunction with something like a Nevada dynasty trust or like a domestic asset trust or irrevocable trusts? Like even though there’s, everybody’s got their different little, what they think is best, what is your kind of thoughts on how this all works and you use what’s appropriate at the time?

 

And you try not to overthink it. The, uh, Nevada asset protection trust. Yeah. All that is a trust that could last 365 years. Good to cans into another one and keep going on. It just means we’re getting it out of our estate. I don’t own any anymore when, while I’m alive, technically somebody can’t take it from me.

 

So they’re an asset protection tool and in all living trusts end up becoming. If you draft them right. Dynasty trust anyway, you know, unless you want to give all your stuff to your kids right away. So I would say don’t do that. My experience is that you’re better off having instead sit in trust for their benefit during their lifetime, and then going to another generation and you can have them go for a long period of time and you can pick whatever state you want.

 

So Nevada is the number one state for asset protection for us. The reason being is a, they last a long period of time, 365 years. You can make that go longer. But also if you have a creditor of a beneficiary, all creditors are protected. Whether it’s child support, alimony, personal injury, there’s no exceptions and most States have exceptions.

 

So Nevada does not. So we tend to. Put the Situs of our trust in Nevada for that reason. So that’s why you see you here in Nevada asset protection trusts. It’s a fancy way of saying credit shelter trust set up in Nevada. You know, it stuff, but stuff. I think we’ll talk about, bring you to the mastermind and cut Bobby, talk more specifics with the folks there at a future date, but let’s get back to the crystal ball here.

 

So the big thing is the $400,000 threshold. To me, if you’re able to lower your AGI below 400 grand or even less, does it not even matter still on 32% tax bracket, if you’re over 400,000, that 39.6 plus your state. So it’s going to be painful. If you’re below the 400,000, you’re going to get a deduction.

 

That’s going to come back. So that may help some people out. You’re a state and local taxes. You’d be at a write off right now. It’s capped at 10,000. So for some people it might actually be better. We always look at what’s bad about it, but what’s good about it is you make less than 400 grand. You’re going to protect protected class.

 

If you make over a million bucks, you’re completely you’re on the endangered species list. You got to do something, you got survive. Some, there are some ridiculous ways, by the way, to lower your income, you’re doing one late in your real estate professional. That’s not available to everybody. There are things called defined benefit plans that have become more and more powerful over the years with savvy.

 

Advisers where you’re able to put in some cases, upwards of a million dollars a year tax deferred, there’s other vehicles, if you want to get there. And it’s just recognizing that, which category you’re in, if you’re making 200 grand or in below you’re okay. There’s some things you can still do to lower your taxes.

 

Absolutely. There’s still some things you can do to make sure that you’re. Taking advantage of, of opportunities that are available to you to minimize your tax about you’re not, you don’t have the bullseye on your forehead. You’re making 1.5, 1.6 million a year. Got a goals eye on both were asset projection by the government.

 

They want to take a big chunk out of that. And there’s some things we can do to lower that so that you’re not sitting there feeling like you’re just opinion getting hit and all the canvas. So let’s talk about that a little bit. Maybe not for example, like land conservation, easements, not, let’s not really get into whether that’s.

 

It’s going away or right now it’s being fought around a little bit, but what’s what do you think with the new administration new things might be coming? I think that would actually be kind of a greater incentive lane. And I would, the only thing that I would say is the administration right now is looking at it saying that there’s been abuse in the conservation area where they’re overvaluing the conservation easement itself.

 

So it’s something called a listed transaction. If you go over 250% of your investment in an English, it means I give a doll. And I get a deduction of more than $5. They’re going to look at the transaction. That’s all. They’re going to make sure that it’s legitimate because there’s people out there pitching 15 and 20 times.

 

Yeah. Those are the boneheads, right. Taking advantage of it. There’s no way that the value holding up. So I got, we have one right now that we’ve been looking at and these are legitimate. So it’s a developer. Developer is developing a big chunk of Vail, Colorado. So they have an area that they’re willing to conserve.

 

What it does to their other developments is makes that land more valuable. So they’re willing to put restrictions on an area that’s already been approved for the development. All the plans are up like you literally, they built sections of it. And they said, this land is worth $40 million with the developments 42.9 or whatever, but we bought it for 9 million.

 

So we’ll give away all the development rights. And they get a deduction for it. And what is what it is. They say here’s an area that would be perfect if it was never altered. And it’s where two rivers come together. It’s about, that’s going to make everything else. The whole area is going to be better off.

 

So there’s about $30 million of deduction. So if you put in a dollar, let’s say you were one of the 9 million. Then you’re getting a deduction worth. In this particular case, it ends up being more as about $4.70 for every dollar. So you’re going to get to write off, you’re going to have a charitable deduction of $4.70 for every dollar you put in what’s that board at all at 4.7 words, it depends on your tax bracket.

 

If you’re in the 20% tax bracket, it’s going to be 20% of 4.7 is what it’s worth. And it’s what is that like a dollar for whatever it is. See if I can actually do math in my head, a dollar 40 or something around there, a buck it’s you paid a dollar to get just over a dollar. You’re probably not doing that for tax purposes.

 

You’re in the highest tax bracket probably worth it. It’s probably going to be, Hey, you know what? I get a buck 60, a buck, 70. For every dollar I put in, I’m saving a dollar 70. Okay. That’s worth it. Saving an extra 60 cents and that’s conservation stuff. And Biden is showing that he wants more solar and he wants more conservation.

 

So I would say that the opposite is going to hold true on that area, that you could actually see more incentives and there’s a crazier one land. You and I have never spoken of, which is the solar credits that are still floating around out there for business use, for example. What’s going to become a big incentive.

 

And I can almost tell you that this is going to be a reality. So I’m going to get my crystal ball out and say, you’re going to watch this. And then we’re going to listen to this in three or four years and say we were predicting it right now. If I put a solar array on a building and let’s say it costs me a million dollars.

 

I get a tax credit of $260,000, 26%. Even if I finance the whole thing, that’s a credit. I get a credit. That’s not a deduction. That’s a dollar for dollar credit. So if I owe a hundred thousand dollars in taxes and I have a $270,000 tax credit, I don’t pay any tax that year. I use 100,000 of it and I carry it forward into future years.

 

But I also get to depreciate the solar and I depreciate 87% of it. So a million bucks, I’m going to get an $870,000 deduction in year one, plus a $260,000 tax credit. That’s not bad. So there’s, and I think they’re going to increase those incentives. It used to be 30, 30%. And then this year went down next year.

 

It goes to 22%. So that solar panel, you can deduct it all in that first year. You can deduct 87% of it and you get a tax credit for 26% of it. So maybe I actually go around Hawaii and find a contractor. It makes deals with some people, put some solar panels have to sell off the credits to invest in them a year.

 

Is that you’re already there. Yep. That’s exactly what they’re doing. So I have a client. That’s what he does. He, he installed solar, but it gets interesting. What he does. He goes to a utilities, public exempt organizations, five Oh one C3 churches. And he’ll go find a wealthy parishioner and say, Hey, would you, would you put the solar array on?

 

And then do it five-year contract on the energy because there’s going to be energy independent. And so they’ll sell it to the charity and say, Hey, after five years, the array is yours. And so he’s taken the big tax credit. They have a little tiny bit of income on the, on the revenue that’s coming in because they’re technically, they’re selling them the electricity.

 

Although, usually they just give it right to the charity. So that washes itself. There’s a deduction. And then, so you have a little bit of income with a deduction that equals it, but you get that first year. It’s a ridiculous deduction, but where that’s really going to be important later is next year, if the taxes do increase, guess who’s going to be really incentivized to do stuff like that.

 

Yeah, that’d be cool. Like investors bring in the capital, they get the tax incentives and the plan owner gets get some cheaper energy. Yeah, what they do is they lock it in and they’ll say your energy, won’t go up for five years and then you have the right to buy it at some peppercorn price. So you’ve already depreciated it.

 

So you don’t really care and you just don’t want to have a E you would recognize all the income as ordinary income. If you sold it for more, more than your basis. You have a really tiny basis. So that’s what you sell it to them for you like, Hey, 13% basis, whatever that is. So it’s, I just want to not pay anything.

 

Yeah. So during the, during those five years, I have a little bit of energy money coming in and I haven’t payments on the loan on the solar, but it’s basically washing itself. So I, again, I’m getting a huge tax credit. I get a huge deduction. I have very little income that’s coming in off of it. So I’m getting a big first-year benefit and yes, there’s a lot of people starting to do those now.

 

And I think that creative syndicators are going to get into that arena. I think going back to the land conservation easement, I think Democrats are typically more than farm mental sides. So I think that’ll continue to be a little bit, but I, what I’m looking for is then to create some kind of safe Harbor instead of us speculating backroom floor.

 

That they just make it more black and white. So mr. I need to file an April. Doesn’t get all for doubt, but they did, they did make a safe Harbor. It’s 250% and they made everybody list it so that, so the it’s the syndicator that gets audited in those situations, not the individual. So usually what they’re doing is they’re trying to figure out who these promoters are and whether they actually gave away the interest.

 

And so what oftentimes will happen is somebody thinking. I’ll pretend to give away something and we’ll revert back to me in 20 years. So I’ll get a deduction, but it has to be a complete gift and perpetuity. Somebody who, who doesn’t, obviously that’s a syndicator who’s running fast and loose and it’s not.

 

Doesn’t hire competent professionals to look at the situation and say, Hey, you actually have to get your way. And I’ll use the example of our president right now. Trump. Mar-a-Lago is a good example. I think it’s six parcels. Mar-a-Lago the golf course. And he gave away the development rights. I think it was on two or three of them, but also the clubhouse.

 

And so there’s a bunch of cultural antiques in the clubhouse. They have to have a non-profit gala every year, so people can see it. But on the parcels that had the golf course, you gave away the development rights to an outside the conservation RT. And the reason that you do that is so that nobody’s tempted to sell the golf course and build a bunch of houses.

 

It does a couple things, Hey, that will always be open space. It’ll never be developed. They’re not going to build buildings on it. They’re not going to put houses on it. Number two is if there are houses on a golf course, you want to know that they’re not going to sell the golf course. And all of a sudden your house it’s on the fairway on the ninth hole is.

 

All of a sudden in a very dense pack of houses that are on postage stamps, that just happened in a community. That’s literally about a mile away from me here called Queensbridge, where they saw the golf course and they’re going to develop it. And it’s a lawsuit in the making that’s where Snoop Dogg that, by the way, it was in Queens Queensbury, I think it was one of the condos that’s in there, but it was like a super high end area of Summerlin.

 

And yeah, the golf course wasn’t profitable. So the guy just let it go Brown and selling it to a developer. And so all these people that lived on the golf course, all of a sudden, they’re on a Brown golf course. That’s gonna, you know, they’re gonna have neighbors in their backyard. And they thought they were going to be living on a golf course.

 

So there is some benefit to it of saying, Hey, I have a golf course, worst case scenario. It’s going to be open area and you guys can decide, maybe it won’t be a golf course someday, but it’ll be open green area. Maybe it’ll be. Maybe we’ll plant a bunch of trees. And if you give it to like ducks unlimited, maybe there’ll be a wildlife habitat that’s in your backyard.

 

So that’s actually one that people give a lot of land to, but it’s, that’s that world, the people that live in that world land they’re true believers. Like these are the folks that are like, Hey, we need, we need these open spaces, please. Don’t. Put asphalt over everything, especially on why I’d imagine you guys would have an appetite for that.

 

So wrapping things up. The last thing I wanted to go over was the corporate tax rate going from 21 to more of a 28. Do you guys finally got me on a C Corp system after takes me a long time to figure these things out? I don’t have a home office. I have an administrative office because I have a SQL or now I’m getting it.

 

I’m practicing. I’m practicing for that audit, but I’ll probably have you guys talk, but the audit rate is they just came out with the audit rates from 2019, your little, uh, little companies, little S a little seeds, little partnerships were below 0.0, zero five. They didn’t even register. It’s first year, I’ve seen an asterix as the audit rate, as escorts were 0.01, a C Corp syrup when you’re small you’re minuscule, but the people that get audited or the individuals in big companies, companies, the, yeah, the LLC sole proprietors, they still there about it’s still, what would it be about a hundred 1500% more likely to get audited right now?

 

Yeah. It’s not even close. And so I always chocolate because we just don’t see audits here. We actually had seven years that we had zero audits of any of the companies that we set up and we do more than 6,000 returns a year. So like we should be seeing lots of audits because the audit rates traditionally around a percent it’s been dropping, the IRS is understaffed overworked, and they’re focusing on the people that are actually bad doers when you’re a small company.

 

Truly not much that they can get. If you have a lot of different options, you can’t take it one way. You could probably deduct it. And three other different ways as an individual, you have really no options. And so they, when they audit sole proprietors, they win 94 to 95% of the time. It’s a slam dunk. They went about 64% of the audits against companies, corporations.

 

It’s not even close, like when you actually start doing math on it. And you’re like, Oh man, who should I audit is audit sole proprietors all day long out of the modern pause. People are playing games when they’re sole proprietors, you know, they’re more apt to do stupid things. Like you’re not allowed to sell phone.

 

I can’t write off myself on it. And sole proprietorship. I can just go down the email lists and say, who has all the Yahoo or Gmail accounts that have skull audit those guys? They don’t know what they’re doing. If I was the IRS, I would just audit them all. They actually, they do have algorithms and they were auditing all the earned income tax credit.

 

So they were auditing all the poor people that were taking the earned income tax credit because none of them would respond and they’d win. Every audit was the most disgusting thing I ever met. I talked to the programmer who said, I felt dirty after writing the algorithm and it’s stupid stuff like that.

 

You’re just looking at it. And government going guys, I can tell you who the screwballs are. Like we already know who they are. They’re the ones doing everything cheap and fast. So that’s why I do the C Corp guys. But with the taxes going up, Toby is that we’re going to keep it C Corp or we’re going to change it.

 

S-corps what do we do? What’s the plan here calculation to see. So I can tell you the numbers. If you make over a million bucks and you have a C Corp and the C Corp makes its money, pays tax pays it out to you. You’re looking at an aggregate tax bracket of about 59%. That’s going to be painful. So if you’re a high income owner, it’s going to hurt for you lane.

 

If we paid out the profits of the seed Corp, you’re in the 0% tax bracket, your long-term capital gains is the dividend rate. Well, what about like a lot of my clients, like, Hey, The C Corp to them, or S are a little complicated to them. And th they just think of themselves as lowly little passive investor got a few deals that still makes sense.

 

You just do the math. And so I’ll use a stock trader. As an example, we don’t have a miscellaneous itemized deductions, stock traders. It’s really hard for them to qualify as a business or something called trader status, which is not even in the code. It’s just made up. It gets audited almost every time, or you just use a corporation and you haven’t managed a partnership that has the brokerage account and it sounds complicated, but what it does is it allows you to write off all your expenses that you otherwise wouldn’t get.

 

So you just get a pencil out and you say, all right, how much are those expenses? In my experience, the average expense of an individual who’s doing any sort of investing is between 20 and $25,000 a year. If I can write that off, I just look at your tax bracket and say, is it worth it? So if it’s somebody who’s in the 12% tax bracket and they don’t really care, I look at it and say, it’s going to put an extra, let’s say $2,500 in your pocket.

 

Is it worth it to do an extra tax return and deal with a little complexity? And their answer may be no for somebody else. They may be looking at it and they go, Whoa. Yeah, that’s going to save me about $10,000 a year. I need that extra money because it takes me from making 7% to making 13% a year. That’s a huge, like they’re in the 20 to 24% tax bracket.

 

Exactly. And they start all of a sudden it starts those deductions start to mean something. I don’t want to ever put my, my wallet in somebody else’s back pocket. So I just do the calculation and say, Here’s what it means to you. Is it worth it? Technically it’s the same bookkeeping, no matter what you do, you’re required to keep books and records.

 

So I always say that’s a misnomer. What it really comes down to is the little complexity of running a court. And yeah, maybe it’s an extra hour or two a year that you have to deal with it. It’s not, you do syndications. It’s not like it’s earth shattering. It’s not like it’s a ton of stuff. You just, you have to keep track of your books no matter what, that’s the hardest part for anything is keeping track of the books.

 

So all you’re doing is you’re still doing the bookkeeping. It’s just, I have one other mouse over here that has its own tax bracket. And I like to feed that mouse because unlike me it doesn’t have to pay tax on some of those things. Yeah. Okay. So yeah, wrapping up here will be any other thoughts and feelings or anything else in that crystal ball you don’t want to predict.

 

Yeah. Relax. I would say go slow. Don’t make wild moves. Don’t freak out. If we can’t do things one way, we’ll find some other way. It’s rare that you have catastrophic tax changes. Usually they give us things. And so even in the biggest tax changes that we’ve had, whether it be the 86, whether it be 2003, a tax cut and jobs act individually at axes, actually we’re not.

 

Business taxes went down no matter what those are, which by the way, one 99, eight is also on the chopping block. The 20% deduction, I would just look at it and say, talk to somebody who actually understands how these things work. What are the silver linings they’re giving us tax laws always have silver linings, and it’s just, let’s go find what they are and see if actually your situation benefit.

 

It’s weird, but like usually with a little bit of complexity, those that are willing to embrace it, do better almost all the time, because it’s not like Biden wants to hammer people. What he wants to do is he wants to hand hammer the people that are just doing thing mindlessly or don’t have advisers. And so he sets up traps and if he it’s like you’re catching, I don’t know.

 

Let’s say they’re putting a bunch of hooks in the water and they’re waiting to see who will come up and bite it. So don’t buy it. Yeah. It’s like the heads I win tails. I win complexity helps because in the complexity you can find a path forward and stop complaining, try and find those ways to get her up off.

 

I just wish that Trump hadn’t used the carryback and hadn’t used the accelerated depreciation and use the costs or the conservation easements. Because they used it. They hit him over the head. When really realistically they should have been saying here’s huge tax incentives that we want everybody to participate in.

 

We’d love to see more development. We’d love to see more conservation instead. They said, Oh, look at him. He’s not paying any taxes. Yeah. Like here’s the guy that. He saved billions of dollars on his taxes because there’s incentives to do X, Y, and Z. And he took advantage of those incentives kind of like shut up.

 

You emphasize it. Just why bring all this attention to this stuff, right? They didn’t do it say, Hey, and you saved tens of thousands of dollars a year running your business as an escort. You never heard him say there was one or two articles where they actually pointed out. Hey, you set up a structure where you’re able to reduce your own age disability and survivor’s benefits and Medicare payments.

 

You save yourself. I think it was like 150,000. It was a pretty large amount and yeah, they didn’t beat him over the head for it. Thank God, because we want these things. There’s incentives to do things the appropriate way. We want people to, we want charitable donations. We want conservations and it’s we want development.

 

We want people to. Want to build more housing cause God knows we’re going to need it. And the poor being left behind everywhere on your Island. I know that there’s people that could really use low income housing. Why are they making it so hard? Give us incentives to do it and we’ll take care of it. I actually think maybe with Biden and everything, maybe my taxes might go up 5% overall, but with all the money that they put into the economy and they spend money, like drunken sailors, especially on the low income housing stuff.

 

I think if you’re like before they would put a bunch of housing in projects, right? Like they, they would densify all the low income stuff. Now the push is to spread it out to more suburban apartments here and there amongst nice houses in these neighborhoods. I see that as opportunity for investors to go like apartments, or I know you guys see that stuff too.

 

It’s huge. It’s huge. I work with the United way Catholic charities and nonprofits that work with terminally ill, autistic adults. There’s no housing for these folks. And like, I don’t want to go down that path right now, but it’s. Serious as a millions of folks are going to be in a really bad situation.

 

There’s almost a million autistic adults that are living with their parents. What happens when the parents pass away, these folks can not live on their own. They’re going to need some sort of assistance. So there’s going to be that the elder population is, but we’re living longer in our older population is growing about 25% faster than every, than any other demographic.

 

We’re going to need to house people, but they’re not going to be able to live on their own where we’re going to just put them in nursing homes. That would be horrible. So we’re going to have living arrangements that work there. And then there’s the last 10 years of all the housing that’s been built about 75% has gone to people making more than $75,000 a year.

 

So you have a section of society, especially the millennials that are being underserved. So, uh, what they ought to do is create incentives for folks like you. Folks like me, who love real estate, like to develop and give incentives to solve that problem. And the accelerated depreciation is one fixing the voucher system right now.

 

Not everybody wants to do HUD housing. But there’s other systems for people, whether it be veterans, whether it be somebody who’s got a short-term need or has a certain type of disease, or again, autistic or whatnot, where there’s groups that, that give incentives to people like you and I to help solve that issue.

 

By giving us tax incentives to do it. And that’s the best thing they could do because the government sucks. That feels strange. It really bad. Anything else going on in Anderson, you want to give a shout out to, you know, what we’ve been going gangbusters. We love working in the tax and asset protection and the estate planning.

 

What I would say if you’ve been part of our infinity group for anybody, we’re going to make that free now. The basic infinity that used to be a hundred dollars a month is going down to free. We lowered it $10 last year. And now down to, to free. If you want people to learn how to invest, I love getting young people into it and they actually learned the principles of money.

 

That’s actually really fun. I’m always doing, am I doing one tomorrow? All day long, but we teach a workshop and then there’s, they can come in and trade in the stock market with, with a fiduciary, like a professional every Wednesday. We just train people on how to be good investors and there’s not a dollar to be had.

 

And if they can just go do it, I spoke to some of your mastermind folks in an infinity group, and it’s kind of cool guys. Like it’s, it’s, I’m not a big fan of the stock market. Sure. But the way they teach it as like more, it’s like cashflow investing, but like investing in dividend type of stocks. So they teach you how to do that.

 

It’s great for like younger guys who. Need to save up some money to go buy a rental property and get started. Or some of you older guys, just looking for that hobby to do it too. It’s casual. We call it being a stock market landlord. Everybody forgot that the stock market used to be a place where you got paid to invest.

 

Then it became, Oh, the is going to go up. No. If I gave lane money and said, Hey, open up a restaurant, I’d expect him to pay me something for it. I wouldn’t wait 10 years and say, Hey, if you ever sell that restaurant, I hope we make some money. That’s stupid. So we cashed, or there’s only about 60 companies that give you good cashflow.

 

And then we show you how to rent the stock. So you could make a good 10, 12% a year, pretty consistently out of the stock market. Just picking those companies and renting them out is a fancy way of saying covered calls. It’s actually fun. And, uh, we do it because if younger people start doing that, they won’t be afraid of it and they won’t get taken advantage of by all these knuckleheads out there in their suits, trying to take your money and put it in an account mutual fund and rip you off.

 

I shouldn’t say rip you off. I always get in trouble. Somebody yells at me for saying that mutual funds have really high fees. ETFs are really cheap. Just take 30% of all your gains, right? 70%, 70% is the average what their fee will end up taking away. 70% of all the growth. You’re a hundred percent at risk.

 

You get less than a third of the benefit. Once people realize that’s how wall street makes its money. If you guys want, because I go to the Anderson advisors.com or Mickey mouse and your lane. Good stuff going over. Toby. Appreciate your time. Hey, it’s always fun. Thanks. Thanks for having me.

https://youtu.be/a6YimSdAVu4

0:15  

So the question often comes up, how do I become part of the general partnership and get a little bit more bang for my buck, one of those ways is becoming what’s called a key principle or loan guarantor for the team. So what this is here for as we go out and get one of these big loans for these Fannie Mae, Freddie Mac, or any other loan, we need to have a partnership team or keep principle slash loan guarantor roster of individuals whose network gets us over the hump greater than or equal to the loan. So for example, for going after a $20 million building, probably going to need a several guys or one guy who has $20 million net worth to be able to sign a debt. So in order for us to qualify, or in order for your qualified typically, that means, you know, you’ve got a million dollar net worth or above, I mean, most guys in our sphere about a one to $2 million range. So guys, unfortunately, those guys are kind of a diamond doesn’t just one of the guys, it’s the same. But if you know, if you’re above $3 million dollars or more, you’re actually very valuable. And you can definitely get compensated for sending off a debt on one of these deals, it has nothing to do with bringing in any money involved. So what a lot of these guys will do these high net worth investors, they’ll sign on debt, and I get a little piece of the deal just for doing so there is obviously risk involved, right. But I think there’s a difference between non recourse and recourse that and before you start doing this, you know, I would say you got to really strongly feel confident in you’re working with defeat, I wouldn’t be doing it on your first board round with somebody doesn’t matter how much they’re paying you. Because essentially, in a way, you’re putting all your family network on the line. And you can encumber your debt several several times. So I’ve signed on, I don’t even know how many deals at this point, also with non recourse debt, but it’s crazy to me how you could sign on multiple walls. But then again, you know, a lot of these are asset backed deals. And as real estate bows, the value is there built into the asset with some common questions that come up are how does this work? How does this book my return? Well, it’s not really bumping your return, you’re just kind of picking up some general partnership shares overall shares in the process. So there’s always a set aside a certain amount for people who do this type of stuff. And talking back about the non recourse components, you got to remember that even if a deal is non recourse, there’s usually a bad actor clause involved with the bad boy carve out where if somebody in the general partnership does anything fraudulent steals money and vessels that the agency lender can avoid that non recourse component and come back for everybody for the debt. At that point, I’m just speculating, you know, I think they’re gonna kind of come after the people with the biggest wallet folks. And then it becomes definitely an internal litigation issue, but hopefully it never goes that far. And you know, another way that people will get into deals with Latino money as a general partnership is for putting up the hard money on these deals. So certain markets such as Dallas are super competitive and to be considered serious and for them to even look at your offer, they have to put in 100 or $200,000 of hard money and for a lot of new sponsors, they may not even have that money in their pocket. And this is why I like working with people who are at least a million dollar net worth and above the fray Why’d I shy away from investing with house flippers because a lot of those guys are under half a million billion dollars unless they’ve been doing it for several years. I just don’t want to get screwed over by guys who don’t have a net worth to cover it personally and this is one of my criteria when investing personally but I digress there so what you could do is you could come in and put up the hard money for somebody who doesn’t have it and negotiate some percentage of the general partnership for doing so there it is long as the deal closes you should be able to get your hard money back and in return you get shares of the deal but I don’t know I feel uncomfortable with this. I think it’s a lot of money I don’t know if it’s quite worth it. I’ve seen deals go through due diligence and for some reason it falls out I also see a lot of deals that get shoved through because the operator doesn’t want to lose their hard money or they don’t want to pay off their hard money lender and not because they didn’t close the deal. That can always be a little shady too but are they for me I sign on the debt on loans I think that is pretty fair in terms of what you’re compensated with and you know you should like the deal you should trust the people you’re working with. The same goes for any work with people you know, like or trusts to begin with, and yeah can be a great way if you’re higher than a few billion dollars net worth to get a little bang for your buck but if you if you guys have any more of these questions, I would check it out at simplepassivecashflow.com/kp or go to simplepassivecashflow.com/syndication for the complete syndication guide there and I am coming up with the ecourse I’m actually working on this month as I’m wrapping up wrapping up the home arrest here why it’d helped me get stuff done without a lot of other distractions. So be on the lookout for that and we’ll catch you guys next time.

 

5:07  

This website offers very general information concerning real estate for investment purposes every investor situation is unique always seek the services of licensed third party appraisers inspectors to verify the value and condition of any property you intend to purchase. Use the services of professional title and escrow companies and licensed tax investment and or legal advisor before relying on any information contained herein information is not guaranteed as an every investment there is risk. The content found here is just my opinion and things change and I reserve the right to change my mind. Above all else, do your own analysis and think for yourself because in the end, you’re the only person who is going to look out for your best interests.

 

https://youtu.be/umCsNG8sLNc

0:00
The passive loss will be suspended in period four because I cannot use it I don’t have I’m not a real estate professional, I’m not defending anything, so I can’t use that passive loss.

0:13
Anyone they even try to rent them out.

0:21
Hey, simple passive cash flow listeners. Today we have Brandon Hall, a CPA, we are going to be talking about some of the very commonly used tactics that we talked about almost every other week in the mastermind, you guys can learn more about that. It’s simple passive cash flow, calm slash journey. We’ll see accredited investors in there. We’re talking about how we’re going to customize what we’re going to talk about generally today. But yeah, thanks for jumping on Brandon, these questions always come up. So it’s always great to get a real CPA to kind of break it down for us.

0:53
Yeah, happy to be here and happy to help.

0:55
So let’s kind of start start from the top right, like syndication investors get passive losses, maybe you can kind of break that down, and then we can kind of get into Well, how do we use those? Sure,

1:07
sure. So when you invest in a syndication as a limited partner, the losses coming back are definitely going to be considered passive. And those passive losses can only offset passive income from your other passive activities. So I could have like a syndication that is producing positive net income, and that’s passive income. And then I could have another syndication that I’ve just invested in, that’s going to push back at the last from like a cost of creation study, I can use the losses from syndication beams offset the income from syndication a, so you can cancel them out. But if I have net losses, even after I do, even after I offset all my income, by net losses, they are net passive losses, and they get suspended and carry forward into future years until it can generate passive income, or until I sell a syndication investment adding game. So we don’t lose the suspended losses, they just sit on our books to hang out until we can generate income to tap into them at some future point.

2:05
And one of the main reasons why I invest in syndications these days, instead of your little one off single family home is single family homes, you can deduct it over what 27 years or so which is very lame, it’s gonna take forever to get that but with those with when you do a cost segregation, which I typically pay maybe five grand to do one of those, I can extract a third of all the depreciation in the first year distribute that to all passive investors. And I don’t know what you’re seeing Brandon, but like, typically, on an investor load where they’re using pretty healthy leverage 70 to 80% loan the value, they put in 100 grand they’re getting anywhere from 50 grand to over 100 grand a passive losses to the first year. But what do you kind of seen as you guys put together all these k ones?

2:54
Yeah, yeah, I think we pegged somebody with somebody my firm was tracking, I believe the average was around 90% of whatever dollar you invest is going to come back as a passive loss across all syndicates investments that are out there. So that includes the 50s. That also includes hundreds.

3:11
Yeah, something I’ve been seeing these last few months. And if you’ve been seeing deals with like COVID reserves, I don’t know if that’s the right term, but you’ve got to stick three to six months of reserves in the bank can be a substantial amount of money, but it’s definitely been diluting the cost segregation a little bit, maybe bringing it down. 10%. But still pretty good. I mean, can’t complain. Yeah,

3:32
yeah, definitely. Definitely. I mean, we’ve seen I think gold reserves smart. Just never know what’s going to happen over the coming years. But yeah,

3:41
yes. And what’s a newer thing too, yet, you’re seeing a lot of these deals that people are using this different class of investors private equity, what it’s called, it’s kind of a fixed rate of return. They get paid first, but they don’t get any upside. But the one cool thing is they still are considered equity investors and therefore get a piece of the losses too. Yep. Yep. The nice thing about LLC syndicates is that you can structure them really hard you like losing all sorts of interesting structures. I mean, the typical structure is some sort of 2080 3070 4060 split between the GP and LP pref on there. But we’ve seen special allocations of depreciation and all sorts of fun stuff. Well, so investor, you know, puts in 100 grand and maybe gets 50 or $70,000 of his passive losses. Maybe take us through how to use that, right?

4:34
Yeah. So if I invest in syndication, and I receive a passive loss of Indian mount, the question is, can I use the passive loss and let’s assume that I don’t have any other passive income. I don’t have any other passive activities, that passive loss will be suspended in period four, because I cannot use it. I don’t have I’m not a real estate professional. I’m not materially defending anything, so I can’t use that passive loss. But on the flip side, let’s say that I’m built out my own real estate portfolio, so I have five duplexes, and I self manage those five duplexes. And let’s assume that on those five duplexes I, I’ve materially participate and I qualify as a real estate professional. So those five duplexes are non passive activities. When I then go and make a syndication investment, I can make an election to aggregate all of my rental activities into one activity for the purpose of this section 469 tests. So what that means is, if I put $50,000 into syndication, when I’ve already qualified as a real estate professional, and I already materially participate on my own portfolio, I can aggregate in the syndication investment into my overall portfolio. And then I can take a loss, a non passive loss from that syndication investment. If I don’t make that aggregation election, what happens is that syndication investment will still be considered passive. So even if I’m a real estate professional, and even if I materially participate in my, my own portfolio, if I don’t make that aggregation election, I still might not be able to use those losses. So by making the aggregation larger, what I’m, what I’m effectively doing is I’m re characterizing that loss from passive to non passive, and then I can take that loss. So what we’ll see a lot of our clients do is build out their own real estate portfolio, they’ll self manage, it will do all the repairs, or coordinate with all the tenants themselves. It doesn’t have to be anything, it doesn’t have to be a substantial portfolio, but one that will drive you to the 750 hour test in more than half your time test to qualify as real estate professional. And through that they’re also materially participant, so they have that non passive portfolio, and then they’ll go and place syndication investments to boost their current year losses.

6:46
And that’s something that’s common that CPAs will not get on board with the aggregation or that grouping.

6:53
Oh, no

6:54
aspect right there. That’s probably why you need a new CPA, listen to this right now, and need to look at you cross side, I just all I say is like, well, that’s why they have a day job, right?

7:08
So but if you if it’s a good point, and if your CPA ever challenges you on that, then I would ask them to go fill out form 8582. That’s where all these losses get aggregated at the end of the day. And see what they say that

7:23
a good point. I mean, we talk a lot about this stuff on these podcasts or in these groups. And we’re just giving you the ideas and the ammo. I mean, it’s, I always tell my folks in my mastermind, like, Look, you guys are empowered with this information. Your CPA to me isn’t really a tax planner. I mean, they’re not planning for you that they’re there to do your paperwork. If you get a good one. Yeah, maybe they can, but they don’t know what deals are going into. They don’t know how much passive losses they’re going to be. They don’t know what the time horizon or the risk reward profile of those deals are. It’s unfair for them to be able to tax plan out in the head, this is your job. This is your number one costs him like a to do it yourself. But these are kind of the building blocks of starting to do it by yourself and kind of steer the ship on your own. But you kind of are talking about a little bit so people ask a high paid professional making over 200 $300,000 a year, how come I can’t get these passive losses are pals for short and offset my active that’d be to salary that I chose supposed to eat them down? What’s the deal, man?

8:26
Yeah, well, the most simple way to explain it is that your W two business income, capital gains, stock sales, interest, dividend income, all of that income is considered non passive. So if I go out and create a passive loss, I can’t net my passive losses against my non passive losses. So my goal then should be to re characterize my passive losses as non passive. And there’s quite a number of ways that you can go about that one of which I just described is especially affecting those that are investing in syndications. But that needs to be the goal at the end of the day is how do I re characterize my passive losses as non passive if I’m trying to offset my other non passive income?

9:07
And one of the big strategies that we like to use, if that’s possible, is the real estate professional status that any breakdown that I don’t know what we’d call it, but that it’s like a two part test, right? there’s kind of two things that they need to qualify for.

9:22
Yes, yeah, two steps toward tests. And then the third hurdle that you have to get over. So the first two tests, you have to spend 750 personal service hours in the Real Property trader business in which you materially participate, personal service hours, real property, trader business, material participation, 750 hours, the second,

9:43
let’s let’s break that one down real quick. So that means being an LP and five syndication deals does not work, because you’re not you’re not a managing member. But what are a couple of examples that you see, like you mentioned, a few rental properties is that work?

10:00
It will. So let’s talk about that syndication investment. So it’s 750 personal service hours a real property trader business in which you materially participate. Now the syndication is going to qualify as a real property trader business, but you your personal service hours, if you think about the litmus test of a personal service, our what that really means is or the litmus test for it is, if I did not log the time that I’m logging, or if I did not spend the time that I’m spending on this activity, the activity would fail the operation, the day to day operations would cease. If you’re a limited partner, investors in your personal service hours are not going to affect the underlying deal. So therefore, we’re automatically out. But then we’re also not materially participating as a limited partner, there’s just no way that we can. So whenever we invest in limited partnership stakes, or syndications, as a limited partner, we’re not able to hit personal service hours for material patients. So we’re trying to hit 750 personal service hours, and real arbitrators in which we materially participate. We’re already out because none of the hours that we log against that activity will actually count towards that 750 hour test.

11:09
And another thing that we will just leave as a teaser for now is becoming us all part of that general partnership and being an active participation in there get we can we’ll talk about that more next week when you come in, join us on the mastermind call. But that’s more of an inner circle type of activity. But what about for moving on to rental properties? Somebody just owns a few of them?

11:29
Yeah, well, so that second test that second statutory test for real estate profession, statuses spending more than half your time in real estate than you do anywhere else, which could, we will kick out the W two people and business people to be working part time or not at all, in order to hit that second test. So assuming that you can hit both of those tests, 750 hours, and more than half the time, the next hurdle is to materially participate in my rental portfolio. And the the issue that we run into or is typically, it’s typically not gonna be an issue for landlords if you if landlording is your only real estate activity, and whether your landlord in large projects or single family homes, if that’s your only activity, you typically don’t have to worry about the material visitation tests, because you’re going to hit them to visitation on your way to 750 hours. But if you are a real estate agent, then you’re not materially participating in your rental portfolio, but you at the same time can still be a real estate professional because I as a real estate agent could spend 1500 hours brokering deals all day long. Well, that’s a real property, trader business. They are personal service hours, and I materially participate. So I meet test one 750 hours. And by spending 1500 hours during the year, that indicates that it’s my full time job. So I also meet test too. So I’m a real estate professional as a real estate agent. But what if I forget to also material materially participate in my rental portfolio, then my rental losses are still passive. So what we’d like to see is pretty significant participation by either you or your spouse in the rental portfolio itself, in order to hit those material participation pass, or you do the landlording full time, that’s all you do.

13:16
And that was that’s a big misnomer, right? Because people think, oh, I’ll just have my spouse get a real estate license. So then just sell one house a year or something like that. It does not gonna work. Not gonna work. Yeah. Yeah. Another other thoughts are that I think for more of a credit investors listen to his podcasts. It’s like, Is it worth it to buy three crappy houses and be the landlord and get real professional status? Well, in my opinion, unless your AGI is over 300,000, in probably a year, you’re not paying too much taxes? Let’s be honest, it may not be worth it.

13:50
Oh, we have a progressive system. Right. So I think 300 K, I think the 24% tax bracket goes up to $317,000. If you’re married filing joint, so only after 317. Are you taxed at what’s the next 130 2%? So if you’re in like 30 to 3537. Okay, yeah, we want to get creative here and try to mitigate but but it’s also similar conversation to what I’ve been had with a lot of clients and cares Act came out. Everybody wants these big net operating losses. And so they’re like, how much real estate Should I buy to create a non passive loss that wipes out all of my income and increase the net net operating loss that I can then carry back five years? Because that sounds cool. And like, Well, sure, but 100 and whatever $15,000 of this real estate loss that you have is only going to save you 10 to 12% per dollar. So to what extent do we want to create this loss, like we want to maximize the savings, so we might not want to create a huge loss in one year, we might want to space it out. So we stay in that 35 37% range? Yeah,

14:57
just to kind of highlight that for people. If you’re making over $300,000 a year real estate professional status is definitely something you should be looking at. I mean, there’s wonderful things that can come with this, right? Yeah, one spouse being a lot of money, one that isn’t perfect, that person can stay at home, take care of the family more. And actually, at the end of the day, the net on the financial statement is better. Because you’re enacting this strategy. And if you’re I would say, if you’re under 100, maybe even $200,000 of AGI this stuff isn’t probably for you, which is why this is accredited investor mastermind Today the topic. But I think for the lower net worth, guys, the lower income guys, it’s Can you still take 25 grand of passive losses off of like, if you’re making under 100? Was 100 150, or something like that? Yeah, we get gifts, some of the lower the lower income guy something.

15:47
Yeah.

15:49
Yeah. And I think that if you’re in the 22, to 24%, tax bracket, these these losses are still beneficial to a degree in for married filing joint, you drop into the 12% tax bracket, you earn less than $80,200. So that’s that 22% threshold. And 24%, I said was 115. But that’s actually 171. So between 80,000 and $171,000, by married filing joint, I’m getting taxed at 22% after 171 K, now I’m being taxed 24%. So if you’re in that threshold, I still think that it’s potentially applicable. But to answer your question, specifically, if you’re earning less than $100,000, you have what they call a $25,000 passive loss allowance that you can claim, you have to be actively participating, you also have to own 10% of the activity. active participation just means management decisions are much lower bar than real estate professional status than material participation, you have to worry about all that, if you’re earning less than 100, you get a full $25,000 passive loss allowance. As you scale up to 150 k in earnings, that $25,000 passable, passive loss allowance phases out, it phases out $1 for every $2 above 100 K. So if I earn $110,000, I phased out $5,000 of the passive loss allowance and half of whatever my income is above 100, is how you calculate that. And so there’s some strategies here, the first strategy is to manage my income. If I’m in that, in that area, how do that I can max out my 401k contributions, we’ve had people at 150 K, contribute the full 401k contributions of 19,000. And whatever that is, in 2020, make that full contribution, drop your income, your modified adjusted gross income down to 141. And now you’ve just unlocked 90 $500 of that passive loss allowance that you can then claim. And that 90 $500 passive loss allowance then yields another $2,000, assuming taxing for you. So all of a sudden, my $19,000 contribution, my 401k saves me a lot more money than it would otherwise because it unlocks some of this passive loss allowance that I’m able to claim. So if you’re less than 100 K, you get a $25,000 passive loss allowance. If you’re more than 100 K, that starts phasing out. And once you reach $150,000, you’re 25,000 passive loss allowance has been paid down to zero dollars.

18:18
And I think like most I don’t know about most, but a lot of CPAs, especially the more conservative ones will definitely say yeah, you’re not active manager, they’ll tonight kind of fight you on that claim. So you as an investor need to kind of know what the rules are to get what you’re looking for. Because if not, they’re not going to check the box for you. And this topic comes up a lot, right? Like their CPA says, Well, are you actively participating? And they’re like, well, you have a property manager. So they say you’re not?

18:46
Hmm, yeah, you can be actively participating with a property manager, you might not be materially participating if you have a property manager. But those are two separate tests.

18:56
Right? material participating, like you said, is for real estate professional status, but for what we’re talking about right here is just active participating. And you’re you’re making the shots, somebody else is doing your dirty work, but you’re calling the shots.

19:07
Exactly.

19:09
And but like just using an example, this is kind of tax time right now, this is tax time for everybody who is more of a sophisticated investor, that actually files in October, like once you get your return back, this is the stuff you should be checking, right that they they maximize that $25,000 if you have the passive losses, if you’re under that threshold, so this is where you would have to kind of keep that in check and kind of drive the ship. But I’m sure that it just does it does it automatically.

19:37
We trained our staff and try to do that automatically. We do make mistakes. I think everybody makes mistakes, especially when you’re trying to crank through tax returns leading up to the deadline but for the most part, we get it right we ask you questions.

19:50
Yeah. And I know you guys you kind of share my the same sentiment as me is like you’d like to work with good clients, right that know this stuff as opposed to walking in a meeting with a client and then They are asking you why blue ocean questions? What should I do Brandon, those, those are bad clients to work with. Like, you want them to kind of know this stuff. And that kind of you can work collaboratively with them and see what you guys can create.

20:14
Yeah, absolutely well, and that’s kind of my my new mission is to educate investors across the country and empower them to have better conversations with their own advisors. So we’ve been like focused on a lot of educational content recently, to help facilitate that it’s been going pretty well.

20:31
So just to kind of wrap things up, things that you’re seeing in the the stimulus plan, I think we’re recording this in October before the election. But what do you what are you kind of excited that might happen to be on the lookout for Trump’s taxes?

20:48
So the new stimulus plan, not a whole lot in there for real estate investors or the real estate investors should be aware from a tax perspective, obviously, they have all the eviction moratoriums, and definitely get up to speed on. But going forward, right now we have this big payroll tax deferral that nobody’s using, that I’m aware of. If the republicans win in November, the thought is that they will make that that payroll tax deferral permanent next year, that’s the thought that’s a that is a prediction, I can’t confirm that that will or will not happen. But that is something that they have promised, if they win. On the flip side, if the democratic party wins in November, then we’re going to, we will most likely see a lot of changes related to the tax code, we’ll probably see some 2017 tax cuts and jobs act provisions rolled back, we might see the elimination of the step of basis rules, whenever you pass away and you pass real estate on to heirs. They get to inherit the property at the fair market value, they can start depreciation all over that wipe out all the gains all the depreciation recapture. So that could potentially go away. And then 1031 exchanges are being challenged again, but I don’t think that I would expect in 31 exchanges to stay within the code and not actually be pushed out.

22:12
Yeah, I’m a big advocate for like, I don’t really care about the 1031 exchange let them have it. I mean, with bonus depreciation, that’s what I really care about. Right now the sunset it starts at what 2022 or something like that starts to step down. And phase out. You think that’s going to be going away or extending gym bonus depreciation? Yeah, with the heavy with the cost segregation to bonus depreciation.

22:37
Yes, bonus depreciation is going to start being phased out in 2022 or in 2023, it drops to 80% and then the next year 60 then 40, then 20 and zero so I would expect at some point Congress to reconvene on that and try to figure out if they want to keep it or not bonus appreciate has been around for a while whenever it sunsets it gets extended we might see similar treatment again

23:03
Yeah, and when you seen Democratic or Republican Party you’re meeting the senate right so that people okay, clear. Yeah, presidential just a figurehead. Yeah, but yeah, I want you to give her contact information folks get a hold of you and yeah, thanks for coming on.

23:18
You had a problem you can contact me at www.therealestateCPA.com we’ve got a lot of educational content on there, that real estate professional status, we have a 12,000 word guide on exactly how it works for with Internal Revenue Code citations and Tax Court cases that we’re not seeing you. There’s a lot of bad content out there on real estate professional status. So we decided to set the record straight so check that out. That’s all on our website. Again, that’s www.theRealEstateCPA.com

23:48
and I’ll put on all these resources including this video a bit simplepassivecashflow.com/tax, that’s slash tax. And if you guys want to join our mastermind, check it out. It’s simplepassivecashflow.com/journey. Brandon’s gonna be in there I think next week Monday answering all my more devious questions on tax and different ideas I have that we kind of talked about in our little cave works ourselves. So Alright guys, we’ll talk to you guys later right this website offers very general information concerning real estate for investment purposes every investor situation is unique always seek the services of licensed third party appraisers inspectors to verify the value and condition of any property you intend to purchase. Use the services of professional title and escrow companies and licensed tax investment and or legal advisor before relying on any information contained herein information is not guaranteed as an every investment there is risk. The content found here is just my opinion and things change and I reserve the right to change my mind. Above all else, do your own analysis and think for yourself because in the end, you’re the only person who is going to look out for your best interests.