January 6, 2009 · 11 comments

I wasn’t very happy with the CPA that I had been consulting for the past 8 months (which is disappointing considering the 3-part post I write on finding a good CPA). He didn’t seem to be exceptionally knowledgeable about the real estate issues I’d be facing, he wasn’t an investor himself, and frankly, I got the impression that he’d be just as interested if we weren’t his clients.

So, in my search for a new CPA, I got a referral from another Atlanta investor, and set up an appointment. Today, my wife and I met with him for about 90 minutes, and were very impressed. First, he is an investor himself. Second, he specializes in real estate investors as clients. And third, he offered ten times as much information in our hour and a half discussion than our other CPA offered in 8 months.

The new guy won’t be cheap, but I’m confident that he’ll save us plenty more than we’re paying him, and he’ll also make our lives much simpler in terms of managing our business structure(s) and finances. He has a flat-fee program for clients that provides: a set number of hours of his time for consultation, tax preparation, setting up entities, etc; it also provided for 8 hours of book-keeping support — I imagine I’ll use this to have his book-keeper teach me how to import my Quicken data to Quickbooks and how to use Quickbooks for my book-keeping; the set-up of a “master LLC,” to be used as a partnership entity to hold our long-term real estate assets; unlimited email support from him; and use of their office as Registered Agent for any of our business entities.

Among the topics we discussed today:

  • It’s time to officially hire my brother as Employee #1. He will now be paid as an employee, meaning I’ll have to set up payroll services ASAP. I’ll be looking into using one of the major online services (Intuit, ADP, Paychex, etc);
  • My previous CPA neglected to tell me that I need to file a tax election for our LLC within 65 days of organization. While it’s possible to work around this (filing a petition of amendment), it’s a bit disheartening to think my old CPA had no idea I needed to do this (I specifically asked, and he specifically told me to hold off);
  • We will start a second LLC specifically for the income generated by my wife from real estate commissions and from her staging activities;
  • We discussed how we will hold our properties moving forward, with specific emphasis on those properties we plan to hold for the long-term as rentals;
  • I learned that I can not claim Real Estate Professional status using the hours I spent working on properties that were not meant to be held as rentals. In other words, my time spent focused on the flips can not be used towards the 750 hours I need to be classified as an RE Professional. While this won’t matter much in 2008 (my losses aren’t that big), it could be an issue in 2009 and future years;
  • Unfortunately, due to the large amount of income my wife and I generated early in the year (before we left our jobs), we are very likely going to run into the situation where we can’t deduct things like moving expenses, which are disallowed if you have over a certain amount of income. This means that our 2008 tax bill could be hefty. We’ll see…

I’m planning to spend the next couple days getting the rest of my tax data in order and sent over to him, and will also focus on some of the items we discussed, such as setting up payroll for our first employee, figuring out the details around our second business entity for the real estate business (“Lish Realty, LLC”), etc.

I’m finally confident that we have the financial future of our business under control…now it’s time to execute on it…

11 responses to “New CPA”

  1. Chris says:

    Thanks for that post. New to Atlanta and am looking for a CPA. Any chance you can give me the contact details for yours?


    Chris Palmer

  2. J Scott says:

    Chris –

    I’ll send you an email…

  3. Laurice M says:

    Hello J,

    Good info. I read your post often. I too am looking for a competent RE CPA that understand the issues specific for RE investors for I am a newbie trying to assemble a team. If you are still with your CPA may I have contact info as well for your CPA? THanks.

  4. J Scott says:

    Hi Laurice,

    Are you in the Atlanta metro area? If so, shoot me an email and I’ll send you the contact info for my CPA…

  5. Laurice says:

    Hi J,

    THanks for the response. Yes, I in Atlanta area. I live in Conyers. Still trying to find a CPA that has a clue about handling RE Investors taxes ect. Appreciate your input.

  6. Greg says:

    Great stuff, your blog is a like a great book I can’t put down. I find that you and I are on the same thought process wavelength, so the way you are doing things and explaining your decisions make total sense.

    I’m in Cobb county…..would you share your CPA contact information and a couple of good GC leads (GC, not gc)?

    I’m not new to real estate, but am new to rehab. My business partners “somewhat” has folks in place, as he’s had a tad more experience; however, since we’re formalizing things and getting more serious, I’d like to up the ante a bit by bringing in proven team members that are potentially more costly but well worth it in the long run.

  7. J Scott says:


    If you actually want the book that you can’t put down, here you go:

    As for CPA, here is who I use:

  8. Jack says:

    Can you send me the name of CPA that is investor knowledgeable and here in Atlanta? Also, I would love to talk to you about partnership opportunities.

    Jack Planchard

  9. Andrey says:

    I’ve already said thank you at the BP for all your posts … And here I am looking at tons of information. I guess I should say THANKS A LOT 🙂

    I am looking for a CPA as well. I know that you’ve moved and I am curious if you’ve experienced any difficulties with your CPA being in the other state? Do you mostly use email or phone for his consultations?


  10. J Scott says:

    Hey Audrey –

    My CPA is in Atlanta, where I used to live. I’ll continue to use him, which isn’t a problem as the bulk of our communication is over email and phone. As long as the CPA is familiar with tax laws in the state where you live, I don’t see much issue working with someone out of state.

    Have you contacted Steven Hamilton from BP? I highly recommend him…

  11. Fasil Khan says:

    Does anyone know a
    CPA in NJ of so can you email me
    Thank you

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