Maximizing Tax Benefits as a Real Estate Investor with CPA Ryan Bakke

Mike Mills [00:00:11]:

Hello. Hello, everybody. This is Mike Mills from the Verity Mortgage. And this is the Texas Real Estate Finance Podcast. So welcome, everybody. Today. Today we are going to be discussing something that I've been digging for for a long time because I love saving money, and I am sick of paying as many taxes as I do. So I welcome in somebody I've met for the very first time today. So this is going to be a new experience for me as well, because usually I have people in the studio, but I have a CPA with me that specializes in real estate and real estate investment properties and the taxes that go along with that and how to save the most amount of money. So please welcome Mr. Ryan Bakey to the show. That's my production value right there. It was real brief, though.

Ryan Bakke [00:00:58]:

Thanks. I appreciate it.

Mike Mills [00:00:59]:

How are you doing, man?

Ryan Bakke [00:01:01]:

It's more than I've gotten some podcasts. Yeah.

Mike Mills [00:01:03]:

There you go. Hey, everybody's got a podcast. Everybody's got an opinion. And they're like, you know what?

Ryan Bakke [00:01:13]:

Yeah. If everybody's a millionaire, no one's a millionaire.

Mike Mills [00:01:15]:

Same things. Exactly. Well, I want to get into your background a little bit so everybody kind of knows where you're coming from on your education and your firm and all that stuff. But just right out of the gate, can you tell me if you were a Realtor right now or you were anybody structuring your taxes or just trying to make more money or save more money in real estate? What's the number one thing that you can do to either make the most or save the most amount of money just right out of the shoot?

Ryan Bakke [00:01:43]:

Yeah. Especially being a Realtor and being a 1099 as opposed to a W. Two, you already have the advantage to save money in taxes because you're a business owner rather than an employee. But to combine being a 1099 business owner with investing in real estate, you open up what I call like, the golden goose egg of the tax code. And the quickest way to make your next $10,000 in real estate is to just save $10,000 in taxes. Because I promise, hopefully after listening to this podcast and doing some more digging, if you're a full time Realtor and you own investment properties, we can at least save you five figures here today.

Mike Mills [00:02:19]:

Wow. Really and truly, if you're looking at it as opposed to making money, you can make money by saving money just by having that extra knowledge and having the right deductions when you do your taxes.

Ryan Bakke [00:02:30]:

Yeah, and I've actually had that epiphany of I've had to change my marketing and my language because I've always come for the mindset of saving is like, hunkering down rather than making it's like a growth mindset rather than a fixed, like, bring it in and hunker down and save. I've had to actually change my marketing and my mindset around that recently.

Mike Mills [00:02:50]:

Well, I talk about that sometimes, too. It's either a defensive strategy or an offensive strategy. It's like when you're looking at running a business, are you trying to save every nickel you can, or are you trying to go out and make more money? And there's obviously a balance there, like, you got to do a little bit of both. But in this particular case, today, we're going to talk primarily on how to save money when it comes to your expenses and all the deductions and all that kind of stuff. So before we get into it real deep, tell me a little bit about obviously, you're a young guy, so I'm 44 years old. So anybody's watching this going like, where's this guy going to? Tell us?

Ryan Bakke [00:03:24]:

Right?

Mike Mills [00:03:24]:

So you're a younger guy, but tell us about where you went to school. Tell us about your company, how many accounts you have working with you these days, and just generally give us an idea of how you got to this point.

Ryan Bakke [00:03:36]:

Yeah, I went to school for accounting and finance. Those are my double whammy. I had a really good professor, one of my finance professors. She used to duke into commercial real estate. So we were always analyzing pro formas cap rates, reversions in class. So I had a lot of that background in real estate, but I didn't fall in love with real estate until I started getting more into the tax code and how it benefits real estate investors. Because in my opinion, when you look at the tax code, it's written by Congress, and when you see Congress is made up of business owners, investors, and people who own real estate. And so it's no wonder that the laws that they write are going to favor those types of behavior, because it really does grow the economy if you're in one of those three different fields, there investments, business owner and real estate. And I had that notion, but it really didn't hit me until I was working at one of my first CPA firms while I was in school, and I was preparing two tax returns. I had one tax return. It was a married couple making $200,000 a year. They were both w two employees. And then I had this tax return for the single guy who he owned about 20 apartment buildings in Chicago. So he was making about $400,000 a year in cash flow from his apartment buildings, and the married couple was making $200,000 from their day jobs. He's single, which means he's in a way higher tax bracket than a married couple, and he made double the amount of money, but he actually paid less in taxes than the married couple that made half as much.

Mike Mills [00:05:01]:

Wow.

Ryan Bakke [00:05:02]:

And I remember asking my boss that day, I was like, hey, how's that possible there? And this one sentence that changed it for me, he goes, It's because he invests in real estate.

Mike Mills [00:05:13]:

Right.

Ryan Bakke [00:05:13]:

And that was all that I needed to know to then dedicate my entire life, really to understanding how it works, the tax benefits, getting the loans, appreciation, all the terms that real estate investors deal with. I made it my life work to understand how it works and be able to take things that are extremely complex to most people and boil them down to something that everybody can understand. So shortly after I graduated college, I got my CPA license. I worked at Deloitte Consulting for 18 months, almost two years. At Deloitte, I did consulting for investment banks, hedge funds, real estate syndication. So I was helping people who are already rich and wealthy become even more rich and wealthy. And I decided that I wanted to help not the everyday person, not every person, but I wanted to help the person in their family that wants to change their family tree because I believe there's one person in each family lineage that changes it for everybody. And I want to help that person. So my company now I have two CPAs on staff, another person studying for the CPA, full time, video, social media team. I have VAS, so we have a CPA firm focus on real estate investors.

Mike Mills [00:06:23]:

So I think a lot of people may lose sight of that sometimes when you talk about when you're involved in real estate, whether you're a real estate professional or you're doing investments or whatever the case may be, I never even looked at it that way. When you have the people that literally are writing the tax code and writing the laws that the vast majority of them own real estate and have for a long time, obviously the rules and the laws are going to be much more favorable to those who write it. Right?

Ryan Bakke [00:06:49]:

Yeah. It's just like writing your own script of a sports game, right.

Mike Mills [00:06:54]:

But the trick is learning the rules of that game. So then you could take advantage of what everybody else knows but you may not be aware of because you're a smaller guy getting into things. If you were talking to a real estate professional, like a realtor, for example, and they were getting into the business right out of the chute, like this was their first year coming in, or even maybe somebody that's been in the business for a minute. When you look at business structure, right, how do I put my business together when I come out of the gate to make sure that I get the most advantage when it comes to filing my taxes? Because I have heard and obviously you know way more than I do, but there are some advantages obviously, to being a real estate professional, especially when you own investment properties as well. You get kind of almost like a double whammy, I think. But if you were just going to structure something together between whether it's a Schedule C or you're talking about LLCs or corporations, how would you go about putting something together initially? If you were brand new in the business.

Ryan Bakke [00:07:51]:

Yeah. So let's just assume you're a brand new Realtor and you're getting paid via 1099. So you're not a w two employee. For a brokerage, if you're a 1099, the first thing you want to do is you want to set up a separate bank account for your business. And so you're going to route all your commissions and all the expenses that you have for your business out of that bank account. So you want to separate your personal from your business. So again, all your commissions are going to go through there, but then also all your licensing fees and your marketing material and everything that you have, your costs, your meals and stuff are going to come out of that business bank account. When you're a 1099 independent contractor, you have to pay what's called self employment tax on top of the additional income that you would make as if you were a W Two. So I'll save some time and cut to it. A lot of people look at LLCs and say, okay, does an LLC actually save me money? And the answer straight up, is no. An LLC is just an entity. It's not necessarily going to save you money on taxes. Just by having the LLC. Where the LLC can potentially save you money is if you are making a decent amount of money as a Realtor. Typically because of inflation, I've had to raise this ever since I started talking about it. But I would say now if you're a Realtor netting, I would say $75 to $80,000 and up as a Realtor. If that's your net income, you should be looking to have an LLC, but have it be taxed as an S Corporation. The S Corporation is going to allow you as a Realtor to save money on self employment tax. But the S corporation is not limited to just realtors. If you're a property manager, you can have an S Corp. If you do co hosting, if you do maintenance work, any sort of ordinary business activity. My CPA firm is an S corporation. You are leaving money on the table if you are, let's just say, a six figure earner. And you do not have an S Corporation because you're probably paying. My S Corporation last year saved me $9,000 in self employment tax.

Mike Mills [00:09:53]:

Oh, wow.

Ryan Bakke [00:09:53]:

And back to the beginning of the podcast. I could tell you how to save five figures right off the bat is if you're a Realtor and you're making good money and you don't already have an S Corp, that's your first thing you need to look at is, I need to look into this S Corp piece here just for the realtor business. So we're still on the realtor side, right? So simply by having an LLC alone will not save you money in taxes, but electing that to be an S Corporation. And there's more rules involved. You have to file an additional tax return. But like I said, if you're making $80,000 or more as a realtor net income, you should have an S corporation.

Mike Mills [00:10:29]:

So real quick, when you were talking about the bank statement earlier about depositing commissions into the bank statement and obviously putting out all your expenses, so what do you do when you're brand new and your commissions don't exceed your expenses? So can you give yourself like a loan? How would you go about covering that? So that way you have the ability to make sure that you are tracking everything from the same account. But if I didn't make enough money, if I'm a brand new agent, I didn't make enough money last month, but I still have to pay my dues and I have to pay my insurance and I have to pay my brokerage fees or whatever. How do you reconcile that between having to give personal money into the business and is there some sort of deduction you can get for that as well?

Ryan Bakke [00:11:10]:

Yeah, so you would have your business bank account and you would start that by an owner's contribution. So you could start your owner's contribution could be as little bit of $100. I think when I started my business bank, it was like $1,000. But you're going to have that initial contribution from your personal bank account to your business bank account when you go to set it up. Got you. And so let's say you were to run out of money in that account, you would just keep doing owners contributions from your personal to your business. And then when you do have a surplus of income, you can transfer from the business to your personal as what's called an owner draw. So you have owners contributions going in and then owners draws pulling the money out. Yeah.

Mike Mills [00:11:50]:

Got you. So do you get special deductions as an individual if I move money into my business or is that just no.

Ryan Bakke [00:11:57]:

It'S more so from a legal standpoint of keeping expenses separate. So for instance, you wouldn't want to pay a business expense out of your personal account and you definitely don't want to be paying personal expenses out of your business account.

Mike Mills [00:12:11]:

Got you.

Ryan Bakke [00:12:11]:

Now there are certain things like with my lifestyle for example, so I'm always traveling or like I run three businesses, so some way, shape or form, I could probably write off most of my expenses because I'm always traveling for business. Right, right. But you want to keep that separation of personal and your business account.

Mike Mills [00:12:28]:

So do you recommend people get like so obviously they have their bank account. Would you have say like a credit card as well perhaps? Because obviously for different things you need, whether it's renting cars or whatever the case may be, would you recommend they have an account for that as well? Because I think tracking expenses seems to be a big issue a lot of times with anybody that's self employed. Really? And making sure that everything's kind of in one spot. So whether you have a bookkeeper or whether you're using a CPA, just managing all that together is like, if you can keep it all in one space, is there an advantage to that? Is that something you recommend? How do you look at that?

Ryan Bakke [00:13:05]:

Yeah, even within a business account, I might have a business that owns two or three rental properties. I can have separate credit cards for each rental property. So I might have one business that owns three rentals here, but I'm going to have separate credit cards for each rental. So that way I know, hey, I can pay this bill with this credit card, this bill with that credit card. And so that way I can keep track of my revenues and expenses. A lot easier that way, right?

Mike Mills [00:13:32]:

It makes it easier to manage in the long term, essentially, if you have everything in one spot.

Ryan Bakke [00:13:36]:

Yeah, I mean, that's probably the biggest common mistake, is just really sloppy record keeping and bookkeeping. It's not hard, guys. It's addition and subtraction. We learn in third grade, what did you make, how much did you spend? And that's basically there's a little bit more into the weeds of certain deductions you can take or not take, but that's 90% of it is addition and subtraction. You can figure it out, I promise.

Mike Mills [00:14:01]:

So I've always heard too, whenever you own multiple investment properties, because a lot of people that are agents that are realtors, they do get into investment properties as well, because you're out looking at houses all the time. You're checking out, you know, values, you know, houses that are under priced and overpriced. Definitely you get very familiar with it. So you'll see a lot of agents that will transition into becoming either long term investment rentals or short term rentals or even multifamily. So for each property and you said this a minute ago about having a credit card for each one, do you want to set up a separate LLC for each property that flows into the corporation? Or how would you structure something like that to give you a the best tax advantage? But also the whole idea behind an LLC is liability, obviously. So how would you structure that? Do you need one for each entity?

Ryan Bakke [00:14:47]:

So that's a good question. So to me, it depends on what state you're in. So a state like Illinois, it's like a $75 a year fee to have an LLC. You sign a one page document that says, hey, were you in business last year? Okay, cool. Pay us $75 and sign right here. And that's it. It's really simple. Now say like Texas, you guys have something similar, except you guys have to file an additional tax return with your LLC per LLC. Yes. And so it just leads to your complexity to have multiple LLCs. So I look at it at two different outlooks. I'll tell clients whether or not. They need to have an LLC for each property. So the first thing I'll say is your net worth in real estate compared to your net worth in non real estate assets. Okay? So if you tell me like ryan, hey, I got a million dollar net worth and I got $800,000 of that million as equity in my rentals, I'm telling you you're going to need an LLC for each rental. Right off the bat.

Mike Mills [00:15:45]:

If you have a bunch of equity, you're going to need some protection there.

Ryan Bakke [00:15:48]:

Yes. Okay. Now if you flip that on his head and you say, hey, I got a million dollar net worth, but I only have $200,000 in rental properties and $800,000 in my primary home, 401, KS, IRAs, whatever, then I'm like, okay, you probably can get away with just having really good umbrella insurance on your rental properties. That's why you have insurance. Right, right. The other outlook of it, and this is one that, this is probably one that some people who don't have a million dollar net worth would look at is how much equity do you have per property? So some people will say, hey, once I have per LLC, I'm going to have a certain amount of equity in there. So for example, my threshold is one hundred and fifty K of equity. Once I get one hundred and fifty K of equity in an LLC, whether that's one or two properties, that's the most I could deal with. I want to set up other entities because your net equity of your property is what you actually stand to lose in the event of a lawsuit. That's what they're going to come and take.

Mike Mills [00:16:41]:

Got you.

Ryan Bakke [00:16:42]:

So then there's all types of strategies that we can get into that I help clients with, where if you just Google the term called equity stripping, there's tons of advantages to say, buying the property in your personal name with conventional loan, low money down, better terms, better rate. Once the property appreciates the value, strip the equity out of the property, whether cash out, refinance, HELOC, or liens. And then put the property in the LLC because the net equity of the property you just borrowed against it, so it reduced the net equity and then you go and put them in LLC. So that's more of a legal thing.

Mike Mills [00:17:19]:

So you're basically stripping the equity out with those refinances or whatever, and then using that money obviously for maybe more investments or whatever you're going to do with it. But then once you've kind of, let's call it maxed out your equity to some extent, then you're going to move that property into an LLC at that point because then the benefit is greater. Is that right?

Ryan Bakke [00:17:40]:

The more equity you have in the property, the more you stand to lose.

Mike Mills [00:17:43]:

Got you.

Ryan Bakke [00:17:44]:

Yeah. Because you're only at fault because most of the loans are going to be considered recourse and so you're at fault for you stand to lose what the net equity in the property is. So if I have $100,000 loan on a property that's worth three hundred K, I stand to lose 200 grand. So if I'm going off my rule, I want that property to be in an LLC because it's over 150K. Right. Or I take 80% LTV on the drop my equity down to only 40,000. Or do the math, sorry, 60,000, whatever it is now, it doesn't meet that mustard of the LLC test. So it depends.

Mike Mills [00:18:24]:

So speaking of debt, because I'm a lender, so this is working home loans all the time. We do cash out, refinances and all that fun stuff I want to hear your opinion on, because Dave Ramsay is always somebody that people quote all the time about, debt is bad, debt is bad, debt is bad. Now, in this particular instance, I think Dave's probably in agreement with us on this as well. But when you just hear somebody say, well, debt is bad, I don't want debt. Right. I agree with that. If you're taking out debt to go buy a pair of tennis shoes and you're paying 20% interest on a credit card, yeah, that's a bad idea. But when it comes to real estate and property, why is that debt not necessarily such a terrible thing?

Ryan Bakke [00:19:06]:

Yeah, I would say I actually kind of throughout college, I was a Dave Ramsay disciple, so it was always get out of debt as quick as possible and start investing in retirement accounts. But it wasn't until I got into corporate in the real world and I was seeing what rich and wealthy people were doing. They were getting into debt to buy income producing assets, and they were getting all their money out of retirement accounts. They weren't investing in retirement accounts. So I had this huge paradigm shift myself. So I would personally say I think Dave Ramsay is probably good for like 85% to 90% of Americans. But for the 10% of people that are listening to this podcast right now, I definitely agree. Get out of consumer debt. So high interest credit cards, student loans, car loans, for example, like get out of high interest debt. But income producing debt can be a really powerful tool. And the three things you have to understand if you want to become extremely wealthy is, number one, debt. Number two, inflation. And number three, taxes. So, for example, let's just look at a ten year time horizon, because it's easiest to look at that way, right? So I'm going to use debt in year one to buy an asset. Let's say I use 80% LTV. So I put 20% down on a $500,000 house. So I put $100,000 down, but the bank will give me 400 to go buy the $500,000 house. Right? Now I have an asset. Is that an asset? That's appreciating. So my 100 grand, if I take the 100 grand I put in the stock, market and I get a 5% per year return, I'm only making five grand. If I get 5% on my $500,000 house, I'm getting a $25,000 return. So I'm five X in my return by using leverage. Debt, leverage, same thing, right? And then what you have to understand is that and everybody should be doing, especially if you're like, beginner like one to five house range, do fixed rate, fixed rate mortgages. I wouldn't mess around with like Arms or floating rate, that type of debt, fixed rate mortgages. Because look, look here then. So as I'm paying that mortgage off, the longer I wait to pay that off, typically 30 years, the value of that becomes less and less to the bank. So on a $500,000 house, I might have a mortgage that is, I don't know, tell me, like $2,700, $2,800, whatever it's called, three grand. But I'm paying that three grand off every month. And the longer that it take to pay it off, the less the money is worth to the bank because of inflation, right? That money that I'm paying over and over time is not worth the same as if I was to pay it in year one, but the bank is going to give me money in year one, right? So you have debt or leverage, you have inflation, because the money that I'm actually paying back is worth less now. And then you have taxes, because whether or not I put 10% down, 30% down, or I buy the house in cash, I still get the same tax benefit that we're going to get into. I still get the same tax benefit of that property. And so if I can get the tax benefits in year one and debt, inflation taxes, those are the three things that you really have to understand. And we'll kind of get into the taxes part of it in a little bit. But debt, inflation, taxes, you have to understand those three if you want to if you want to be really wealthy.

Mike Mills [00:22:06]:

So if you were going to buy a house yourself and it was going to be an investment property or let's just say even a primary residence, one that you were going to buy on your own, because I have my own thoughts on this, but I'm curious what you think. What would you put down as an individual? Like, if you were buying a house that you were going to live in, would you put down 20% to save your mortgage insurance, or would you put down the minimum that's required, depending on the type of loan you're doing FHA conventional or whatever?

Ryan Bakke [00:22:28]:

Yeah, I would say one of the things I see investors make the mistake of all the time is they're so focused on the next thing at hand that they're not playing the long term game and setting themselves up for the future. So the quickest thing I see is you got a taxpayer or a client buys a primary home, gets into this rental thing, goes and uses the secondary home loan, let's just say, to buy a short term rental. They cap out their DTI, they can't borrow anymore. They're forced to use commercial loans, DSCR products, bank statement loans, things that have shittier terms, and higher rates typically, and prepayment penalties. So me personally, if I could go back so I bought my first house three and a half percent down, FHA, like house hack, and I had a 3% interest rate at the time.

Mike Mills [00:23:12]:

Real quick, I've heard you say house hack before and other stuff. So explain what you mean by that because I know what you're talking about, but explain what you mean when you say that.

Ryan Bakke [00:23:20]:

So house hacking is where the government will allow you to do an FHA loan and buy up to a four unit property as long as you live in the property. And they'll allow you to put three and a half percent down. So it doesn't work in all markets, but in most areas, Midwest, I still think in Texas somewhere, I think depending on where you're at. But you'd be able to buy a property, put three and a half percent down, live in one side, rent out the other side, and use that other side's income to help pay off your mortgage. And they'll actually, for me, they took 75% of the gross rent that I got on the other side towards ETI Calc. Now, I heard, I think it's like 50% that they take now, but is it still 75? No.

Mike Mills [00:24:01]:

Yeah, still. So yeah, you can do this in Texas because FHA is a national thing. It's not statewide state specific deal. So yes, you can buy one to four units with an FHA loan, and you can put down three and a half percent as your down payment as long as you're going to live in one of the units. And then if you have agreed upon leases with the other units, then you can use what's called a vacancy factor, which takes away 75% of the rent. Now, you can't get income, meaning we can't give you extra income. If your rent was like 2000 and the cost was only 1000, like you are limited. There, there's a weird little rule in there that says you can basically offset the expense, but you can't give extra income. But yes, it does help your DTI, because then in that case, the mortgage payment that you're being counted against you is reduced because you have the leases. And then lots of people and this is something I've talked about all the time when I talk to buyers, and then you take that property, of course, and I tell especially young people, look, if you're going to start buying something early, which you should, and things are really expensive right now, and that's just what it is. I mean, obviously it depends on where you're at in the country, but here locally, I. Bought my first house in 2004 and I spent $130,000 and it was 1800 square foot home in a nice neighborhood. And that same house that I bought in 2004 sold two years ago for 330. So it's crazy. But aside from the whole affordable housing issue, you can then take that property and then go buy another one as a primary residence and then turn that one into an investment and rent it out. Now, if you really want to get next level on it, you probably want to refinance it beforehand. So that way you can take your FHA loan because you can only have one at a time and you can use that on the next property. But even still, I don't usually recommend personally once you get to a certain point with your credit and everything else, that FHA is great because with conventional loans you can put down 5% and the mortgage insurance on an FHA loan is going to be much more expensive if you have good credit. Because right now with conventional loans, your credit, your debt to income and your down payment impact the mortgage insurance. So if you bought, say, a $400,000 house and you had good credit and a relatively low debt ratio, your mortgage insurance on that loan with 5% down might be like 75 or $80. But if you bought that same property with an FHA loan, your mortgage insurance is going to be closer to $200 a month. So even though you're putting a little bit more money down 5% versus three and a half, the overall savings is so much greater that you don't even necessarily need your FHA loan after that first one because it doesn't always make a ton of sense.

Ryan Bakke [00:26:55]:

Also talk about what happens when you get a 20% equity. In either situation.

Mike Mills [00:27:03]:

With FHA, you still pay mortgage insurance regardless of how much money you put down. And with conventional you have the ability to remove it sooner rather than later. So if you pick up equity because the market's appreciated, it's been in Texas at least every market is different. We've seen 20% to 30% over the past two or three years. Now granted that's not expected to continue because the market's plateaued, but even with 8% interest rates, our market's gone up three or 4% year over year. But when you pick up that extra equity, if you get to a point where you have 20% equity, then you can reach out to your servicing bank, request an appraisal, they will come out, do an appraisal, it usually costs you five or $600 and then you can get the mortgage insurance removed. Now, the only caveat is that in most cases, and I don't know of any exceptions to this, but I always say most because I'm always hedging my, you're wrong because you're here. But in most cases that I'm aware of, you have to have mortgage insurance for at least twelve months. So once you have and agree to the mortgage insurance, you have to carry it for twelve months and then after the twelve months then you can get it removed. So I typically tell people whether they're trying to do a recast because we have a lot of people that I want to sell my house and then I need the equity from that house because I want to put 20% on this one. From an investment side, I'm like keep your cash and do something else with it. But if that's what you want to do, then you can take that equity and you can recast your mortgage one time, usually in the life of the loan, where you can take the payment from whatever it is you started at and reduce it down like you would have if you to put 20% or 30% down when you bought it. So if you're going to do something like that, or if you intend to get the mortgage insurance removed, then you just need to wait twelve months and then after that twelve month period of time, then you have freedom, whatever you want. But the reason I was asking you about the down payment side is because as a mortgage guy, I always tell people when I talk to them, like, look, I'm the loan guy, I obviously want you to do a bigger loan, all those kind of things. However, if I'm in your shoes, and I've always done this with my own personal properties, whether it be my investment properties or commercial or primary residences, is I never put down more than I absolutely have to, because the thinking behind it is and tell me if you think I'm wrong on this, because I'm happy to be wrong. But the thinking on it is that money that I sunk into my house, once I put it in there, it's out of play. Like I can't do anything with it. Because the only way I can get access to it is to either sell the property itself or do a refinance of some kind to pull the equity back out. And in either one of those instances it's going to cost me money to do it. So I'm going to have to pay money to get my money out. Whereas when I buy it, if I put down 20% on investment or I put down 5% on a primary or 10% on a second home, I'm not going to put down any more than that than I absolutely have to. Because again, once it goes into the house, I can't get it back out without some sort of event that I'm going to have to pay money to do so. And not to mention I don't necessarily think this matters that much, but the whole interest deduction is always helpful too.

Ryan Bakke [00:30:11]:

Yeah, I'm along the similar lines. I always tell people, like I said, no matter if you put ten or 20 or 30% down, you still get the same appreciation and the tax benefit. And no matter if you pay the mortgage down more, your appreciation is still going to be the same. I would say in certain deals, like the one I just penciled last night for somebody, they were contemplating either putting the 5% down or 20% down. And in the 20% down example, it boosted their cash flow because their debt service was lower, but it obviously cost a lot more up front to do it. But then the 5%, because the 5%, because their piti was so high, it actually crushed their cash flow, right. Overall returns. The overall return actually came out higher by putting 5% down. So one of the calculators that I have that you can download on my website, if you go to learn like a CPA.com Shameless plug, it actually has four different breakouts of how you make money on a rental property. So you have cash flow number one. So that's going to be net operating income after debt service. Cash flow number one, you have appreciation. I typically just model in two or 3%, you have tax savings on the rental property, which hopefully we'll get into in a second. And then the fourth, the lastly, you have, like I said, cash flow appreciation, tax benefits, and then equity paid on, right? So modeling that out, fiver is 20%. Your total percent ROI return is actually greater with the 5%. But in this individual's case, he would have actually been like literally cash flow neutral, maybe coming out of pocket money by putting 5% down versus if he would have came up with 20% down, he would be cash flow positive, but now he's going to come up with 20% down. So most of the time what I see with clients, too, is their debt structure looks a little bit different. The closer they get to retirement age, they want to have less debt. Somebody like me or younger up, I could lever up pretty well as long as my DTI loss for it, I'm doing it smart versus somebody, the closer that clients get to retirement age, the less debt they're going to want to have overall.

Mike Mills [00:32:21]:

Well, that cash flow thing is important too, if you want to use more leverage. Because at some point because I look at tax returns every day, I don't know as much of it as you, obviously, but I see them all the time because I'm evaluating people's ability to qualify for a loan. But what I do see is or what I will tell people is like, look, at some point, you have to claim enough income. Because at least in this environment as it is right now, if you're starting out and you don't have a portfolio of properties that you can then take to a private bank and say, hey, look, I want to leverage my portfolio to get more money so I can buy more properties. But when you're starting off, you have to show income. Because if you want to get an FHA or conventional loan or whatever the case may be, we're going to have to consider your income and your debt. And so in like the instance that you were giving with the guy putting down 20%, there could be an advantage for him there. Because if he can then turn around and say, okay, I'm actually cash flowing some income from this property, which gives him a little bit more income. You're going to pay more taxes. Right. But if I can get more income from there, then I can leverage that income to go get more debt on properties if I want to buy more. Right?

Ryan Bakke [00:33:26]:

Yeah. No, you actually brought up something that I wanted to touch on back to the Realtor camp. I notoriously see this with Realtors all the time. And I'm not picking on you guys. This is what I just see. But Realtors will make $120,000 a year and they'll go buy a $50,000 car and the lender will not add back your 179 deduction on your vehicle for your income. So if you make 100 grand as a Realtor and you buy a $60,000 car, your net income is 40 grand. And that's what they're going to be using to qualify for you for loans. And mind you, if you're self employed, correct me if I'm wrong, but if you're self employed, you need at least two years of tax returns in order to qualify for a conventional loan. Most cases, exceptions may exist. Right. But I think that's the biggest mistake that I see is you have to know what season you're in. This is what I tell investors all the time. If you're newly self employed, you're going to need two years of tax returns in order to verify your income. So at the Bat, everybody says, oh, deduct, or write off everything as possible to drop your income and save money with Uncle Sam. But then you turn around and go to your lender. The lender is like, well, I can't loan you here because you only made X amount of dollars.

Mike Mills [00:34:34]:

That's right.

Ryan Bakke [00:34:34]:

You want to take the right deductions that when you flip over to the investor side of things, the lender will actually add back, like your mortgage interest, insurance, HOA taxes and depreciation that we'll talk about. But I see when you're self employed, newly self employed, when you think about it, you're really thinking about probably two and a half years before you're able to qualify for a mortgage as a newly self employed person. Because you have to have two years of tax returns and they have to be filed. So you're really waiting until April, 2 years plus that April to be able to get returns in order to qualify for a loan. So that's why I think it's so important. I've helped people leave their day jobs to going self employed full time to not doing anything other than investing in rental properties. And I think that's the biggest mistake I see people make is they're only thinking like one step. They are not thinking three or four steps ahead of like, okay, here's the next objective. But how do I set myself up for success in the future?

Mike Mills [00:35:28]:

So speaking of deductions, because you brought it up, tell me a little bit about give me some ideas of certain deductions that either real estate professionals miss out on because they don't consider because they're doing it themselves, or maybe even investment property owners, whether it be short term or long term rentals. Tell me what the correlation or the relationship between because I've heard this before, but I don't really understand it. If you're a real estate professional, like if you're a realtor and you also own investment properties, isn't there another level of deductions that you can get or something along those lines?

Ryan Bakke [00:36:03]:

Yeah. So let's just write into that. So if you're a real estate professional by trade, so you're a realtor property manager, leaser, broker. There's eleven actually types of what are called real property trades or businesses. You can Google them, but let's just take the realtor for example, and let's say you're a Realtor and you make 200,000. Let's say you're a Realtor and you make $100,000 a year. So as a single realtor making 100K, you're probably paying 22,000 to the Feds. Let's just say you don't have state income tax, so you're paying 22,000 to the Feds, and then you also have self employment tax on top of that, like I talked about. So single making 100K, you're probably paying $30,000 a year in taxes. No doubt.

Mike Mills [00:36:44]:

That's a lot.

Ryan Bakke [00:36:46]:

Yeah. But here's where being a real estate professional and owning your own rental properties comes in. Because if you are a realtor and you own rentals and you do what's called material participation in those rentals, which is basically a fancy word for meaning that you are the one that manages the property and you spend a lot of time managing the property. If you can prove that you're a real estate professional and you manage your properties, you manage your properties, you don't have no property manager, nobody really helping you with the management. You can use the losses and the deductions from your rental property to help offset your w two or your 1099 income.

Mike Mills [00:37:23]:

Really?

Ryan Bakke [00:37:24]:

If I make, let's just it's direct amount.

Mike Mills [00:37:27]:

So if you lost whatever, 30 grand managing your properties, you can take a direct deduction from 30,000 off your drop.

Ryan Bakke [00:37:33]:

The gross income by 30 grand.

Mike Mills [00:37:35]:

Wow.

Ryan Bakke [00:37:36]:

So, like, for example, let's say let's up the numbers a little bit. So I have a client that makes probably $4 million a year as a realtor, and he probably buys about five to $600,000 worth of real estate per year. Long term rentals, short term rentals, commercial properties. The depreciation from those from 500 you typically get about 2005% of the purchase price is the amount of depreciation that you typically get so if I bought a $500,000 property, let's say I'm probably going to get $125,000 of depreciation.

Mike Mills [00:38:04]:

Is that over the life of the loan or over the life of the property or the first year? Or how does that depreciation work out?

Ryan Bakke [00:38:08]:

So the depreciation is typically over the life of the property. Got you. Let's just easy math. Let's say you bought the $500,000 property is going to be depreciated over 27 and a half years. So you're really only going to get like, probably 20,000 of depreciation per year.

Mike Mills [00:38:26]:

Okay.

Ryan Bakke [00:38:27]:

That's where the accelerated depreciation that a lot of people talk about, like cost segregation studies come into play because instead of taking $27,000 per year for 27 and a half years, I'm able to accelerate most of that depreciation into year one.

Mike Mills [00:38:40]:

Really?

Ryan Bakke [00:38:41]:

And so instead of taking 27,000, you're able to take 125,000 in this example in year one. Right.

Mike Mills [00:38:48]:

If you're a real estate professional, is.

Ryan Bakke [00:38:49]:

That anybody, anybody can do that, but it's just the double whammy if you're an actual real estate professional.

Mike Mills [00:38:55]:

Got you.

Ryan Bakke [00:38:55]:

See me, for example, because I'm not a real estate professional, that loss just remains passive to me. So I can't use it to offset my w two or my CPA firm income.

Mike Mills [00:39:04]:

Got you.

Ryan Bakke [00:39:05]:

But as a real estate agent who also owns rental properties, you could take that $125,000 loss and take it against your one and 1099 income. So this particular person who's making 250 grand, he cuts his income tax bill in half.

Mike Mills [00:39:19]:

Wow. Okay. Just from acquiring those properties every year.

Ryan Bakke [00:39:23]:

He'S already doing again, these are things that people are already doing that they don't know about that can help them save at least five figures.

Mike Mills [00:39:29]:

Jeez. What else? How does it come to, like, let's talk about mileage because that's always one that Realtors are driving around all over the place. You're a CPA, so obviously we need to be very meticulous when we track our mileage. But how would you recommend somebody go about doing that and how important it is? And do you get that much from something like that?

Ryan Bakke [00:39:55]:

Yeah. So the two ways to get benefits from your mileage is you either take what's called the actual method or you take the standard mileage method. Okay. So the actual method I typically recommend for people who buy cars that are more than $30,000 and up. But the actual method means you can generally write off the full cost of the vehicle in the first year. So if I bought a $30,000 car or SUV or truck, I could take that against my income. But remember, if I'm a first or second year realtor, that may not be the best thing because the lender is not going to add that back to my income.

Mike Mills [00:40:27]:

Right.

Ryan Bakke [00:40:28]:

Yeah.

Mike Mills [00:40:28]:

It comes directly off the money.

Ryan Bakke [00:40:31]:

The other way you can do it is you can just track your mileage. So you might have a vehicle like, let's say you're a part time realtor. So you use the vehicle mostly for personal use or commuting or taking kids back and forth. You can actually track your miles and you get a cent per mile deduction. I think this year it's sixty cents per mile. But in both scenario is you do have to track your business miles. So the best way I recommend people to do this is if you just take a picture of your odometer at the beginning of the year and take a picture of it at the end of the year and all you have to do is track your business miles. In between there's apps like Mile IQ or you can keep a mileage log in Excel or something like that. I used to do that. And then you can just back out the difference between personal and business use.

Mike Mills [00:41:11]:

If you have those, do you get a pretty good deduction hit on that? That helps you with overall income?

Ryan Bakke [00:41:19]:

For the most part, yeah. So the deduction that you get is going to depend on the purchase price of the vehicle, but then also your income tax bracket. So that's why I just kind of threw that out there. Most of the time if you're buying over a $30,000 vehicle, you want to use the actual method because it normally amounts to more deductions. But if your vehicle is under 30K, you probably want to use the mileage method.

Mike Mills [00:41:44]:

So nobody likes to get audited, right. Nobody wants to have the IRS show up and tell them they want to show all their returns. But as a CPA, if someone was filing their own returns now we'll get to the advantages of hiring a CPA here in a second. But if someone wants to file their own returns, are there any deductions or is there anything that they would do that you would say, hey, look, be careful. That can throw up red flags to the IRS that will come out and dig through your stuff a little bit more, keep it conservative. Or there's some things just like, yeah, you can put that on there and generally they're going to be okay, what would you suggest or look out for in situations like that?

Ryan Bakke [00:42:18]:

So I would say the number one mistake I see in self prepared tax returns is the clients missed depreciation, right? So they either don't know how to calculate it or they completely miss it off on their return. Okay, let me give you my long term rental example. So my property I collected last year, I collected probably 14 grand in gross rent on my property. 14 grand of gross rent. I don't pay any utilities or whatever, so my net income on the property, after interest taxes, insurance, whatever, my net income is probably like ten grand. Right. My depreciation on the property was $13,000, which means I have $10,000 of cash flow that hits my bank account that I would have to pay taxes on. But with $13,000 of depreciation, it wipes out the $10,000 of income.

Mike Mills [00:43:06]:

Okay.

Ryan Bakke [00:43:07]:

If something as simple as missing the depreciation calc results in me, I'm in the highest tax bracket. I pay an extra $4,000 in taxes if I had that $10,000 of income on my return.

Mike Mills [00:43:19]:

Wow. Okay, so that's a big miss. Don't want to swing and miss on those.

Ryan Bakke [00:43:25]:

You want to make sure that there's something and the reason why I say this is because I've reviewed hundreds of self prepared tax returns before, and the only person that I've ever seen do it right, that wasn't an accountant. He had an accounting degree.

Mike Mills [00:43:41]:

Right.

Ryan Bakke [00:43:42]:

He'd been there, done it before. Another mistake that I see people make in self prepared returns, and unfortunately, I think this is just by design of how a lot of these apps are set up. Like a TurboTax or whatever vendor software people use is it'll ask you something like, oh, did you pay mortgage interest? And people are like, oh, yeah, of course I did. But it'll ask the same question, like, four different times. So let me give you an example. Like, I saw somebody that had a business that they ran out of their home. So the question asked, did you pay interest in your business? Yeah, I paid ten grand a year on my primary home mortgage interest.

Mike Mills [00:44:15]:

Right.

Ryan Bakke [00:44:15]:

And then it asked, oh, did you have a rental property and you paid mortgage interest? Oh, yeah, I rent out the top of my house, so my mortgage interest was ten grand. So they took the same the $10,000 that they had in mortgage interest. They deducted it three different places on their Schedule C, on their Schedule E, and on their Schedule A for itemized deductions.

Mike Mills [00:44:34]:

Wow.

Ryan Bakke [00:44:35]:

They just thought.

Mike Mills [00:44:38]:

Okay. I got you. So do you think there's a threshold, speaking of self prepared, versus using a CPA? What would be the circumstance or the threshold where someone should go from, hey, look, I did my taxes myself using TurboTax. I go to H and R block, whatever, versus, all right, now I need to hire a CPA because there's going to be certainly the cost benefit is going to be much greater for me if I do it at this point.

Ryan Bakke [00:45:02]:

Yeah, I would say if you have a rental property, it makes a lot of sense to have maybe not necessarily CPA, but have a tax professional prepare it. So right away, if you have a rental property, it's time to upgrade from self preparing and to having somebody do your tax return. If you're just a realtor and you're making, let's just say, less than 50 grand net, I think you can still probably self prepare, but if you're a realtor, you're making 50,000 plus. I think it's time to have somebody prepare your return just because it used to be a lot easier. But nowadays there's just so many deductions and stuff that you don't want to miss, and we literally study the tax code day in and day out. So when your car breaks down, you don't try to fix it yourself. You take it to a mechanic. I don't know why taxes are any different.

Mike Mills [00:45:53]:

Well, especially because if you try to fix it yourself and it breaks again, then there's not going to be a government agency that shows up and puts you in. You did it wrong.

Ryan Bakke [00:46:03]:

Yeah, and that's another thing too. I mean, I see people all the time that they'll grab bits and pieces of whether it's my information or somebody else's information online and they'll say, oh yeah, this is how it works. But don't ask me. I'm not an accountant, right? You don't see me going online and saying, oh yeah, this is how you fix your car. But don't ask me. You don't see me doing that. If you're not a CPA, stop giving advice, please.

Mike Mills [00:46:29]:

Yeah, well, and that's the thing that especially these days because there is so much information out there, there's a ton of information. You can go online and if you really were committed to it, you could probably get the equivalent of an MBA or a CPA or whatever if you wanted to. Now, it's not legitimate because you don't piece paper for it. But either way, there's a lot of information out there, but there's also a lot of bullshit out there and you have to sift through and figure out what the bullshit is and what the real information is simply because if you're trying to go about this on your own, it can be done. But I love Chris Rock. I'm a big stand up comedy fan and he has a joke where he says, you can drive your car with your feet, but it doesn't make it a good idea. You can do it, but it doesn't mean that you should be done. But I would also say, and this is something that me personally, that I've been on a bit of a quest lately part of the reason I reached out to you too is I have a very relatively complicated situation personally with my taxes and properties and whatnot. My wife's a realtor, I'm a mortgage professional. We have two short term rentals, we have a commercial property, we have a home, all those kind of things. But I don't want to do my taxes. I have zero desire to do my taxes. However, I want to understand what is being done because if I understand it, then I'm going to make a better decision when it comes to who I'm going to hire to manage that piece. It's kind of like I use this analogy a lot. It's not necessarily as good, but but I know how to mow my yard, I know how to edge my yard, I know how to mow it. I know how to do all the things that are necessary and I know what it should look like when it's done. So if I hire somebody to come in and do it. I'm taking the best use of my time and doing other things and I'm letting that person handle it. But I also know what he's doing and I know exactly how it should look when it's done. So I know that I'm getting the value for my money, right?

Ryan Bakke [00:48:20]:

Yeah.

Mike Mills [00:48:21]:

So. I mean, you think as well, when it comes to hiring professionals to do the job, take your time, because I've heard you say this before and put it where the best use of that time is, and it may not be if you're a real estate professional, you're buying properties or whatever, then spend your time doing that. Don't spend your time doing your taxes. Just hire the right people.

Ryan Bakke [00:48:39]:

Yeah, it's just like they throw out highest and best use offer. You have to find the highest and best use of your time. So that simply starts a lot of people will say, hey, what is an hour of your time worth? You could calculate that by whatever you made last year divided by however many hours you work, or you just have a figure in your head that says, hey, my time is worth $500 an hour. So if I can get the job, whatever I have to do, whether it's marketing stuff, VA stuff, cleaning, mowing, the grass, if I could find it for cheaper, I'm going to outsource it. A good starting point for that, if you're interested in doing that is actually to draw. There's a book called the genius zone by a guy named gus hendrix, and it basically talks about putting all your activities go two weeks and just journal all your different activities that you do and put them in four different quadrants, with the top left quadrant being the most important, the most super sophisticated tasks that you and only you can do. And then the other three quadrants, those can be outsourced to some ability or figure out how to get somebody else to take a hold of those. Because the argument of the book is a lot of times people only spend 10% of their time in what's called their genius zone. So your genius zone is in my opinion, it's like what you're put on this earth to do. So whether that's you're put on this earth to be a teacher, an educator, your land, whatever it is that you do, mother, a father, whatever it is that's your genius zone. And the argument of the book is most people only spend 10% of their time in their genius zone and 90% of the time doing non genius zone stuff. Whereas me this year I made the shift to where I think I really do spend probably 60% to 70% of my time in my genius zone. And then the other 30% I'm still doing those mundane activities that I don't they need to do. But until I can get them fully outsourced, that's just what it's. Going to be.

Mike Mills [00:50:29]:

Well, I'm glad you brought that up too, because one other thing I did want to ask you about was the way I found you, honestly, is because I've been looking for a CPA to have on the show because I really am interested in this, and I'll probably have more in the future too. But it's something that I think for business owners and real estate professionals is really important because we're all trying to make money and maximize our savings and all that stuff. So I found you by looking online. I just went to TikTok, I went to LinkedIn and these different social platforms, and you've done a great job. You've got a great following online. You've done a good job of building up your platform. I've seen you obviously do speaking events at different conferences and stuff and seeing the clips on those. But what's been your approach? I'm just curious, from a marketing point of view, not necessarily as an accountant anymore, but just as a business owner that's trying to brand yourself out there, what's kind of been your strategy online that you found to be the most effective? And if you were talking to someone else trying to brand themselves in the same light, what would you recommend to them?

Ryan Bakke [00:51:30]:

So I'll let you guys in on a little secret insight. So there's three big pillars in this business that if you can master, you won't ever have to scrap for money ever again. So number one is you have to become the person of interest. And whatever it is that you do, become the person of interest. So when somebody thinks about real estate tax or real estate finances or short term rentals, my name pops up. Brian, baby, just like how you found me. Google Search CPA, right? You have to become the person of interest, whatever it is that you do. And you can do that simply by joining groups, joining communities. The way I got started is I just started commenting on people's posts, responding to their questions people would post in bigger pockets or these Facebook groups, hey, I have this question. Capital gains tax, whatever. I would just simply respond, hey, my name is Ryan, I'm CPA, blah, blah, blah. I would set a timer on my phone 20 minutes every single day. Just do that. Become the person of interest. And then it got to the point where people would be, hey, I don't know the answer, but this guy Ryan does. Let me tag this guy Ryan, and it creates that, okay, this is the guy that you need to talk to, right? Number one, become the person of interest. Number two is what's called the law of reciprocity. So the way reciprocity works is you have to give value without ever expecting anything in return. Just the same way that I'm on this podcast, giving my time away for free that I could normally charge $1,000 an hour for, I'm giving it for free, right. You go to Olive Garden. You got Olive Garden in Texas?

Mike Mills [00:52:51]:

Oh, yeah. We got the Olive Garden.

Ryan Bakke [00:52:53]:

What do they do when they bring you the bill?

Mike Mills [00:52:55]:

They bring you the mints.

Ryan Bakke [00:52:57]:

They bring you a mint, right. So they did a study and it said the waitress that brought one mint got 7% on average tip. The waitress that came and brought two mints got 13% average on tip. But the waitress that got the most money was the waitress that brought the bill with a mint, went to the kitchen, came back and brought another mint to the table because the table thought, oh, wow, she went out of her way to provide us value. Right before they signed the bill, she got the most tip. So you have to be able to give value without ever expecting anything in return. And pillar number three is what's called the transfer of authority. So a lot of people see this as like a referral. Oh, I need a referral for this. It's a lot deeper than that. The way transfer of authority works is somebody's going to go to you, Mike, about a loan question or they're going to have a lending situation. They buy a house and they say, well, I just sold the house here. I really need somebody that can do you happen to know about how the capital gains works or do you know anybody? You say, hey, well, this is what I know in my field, but you really need to go and talk to Ryan because he really is the expert at what it is that he does in this tax stuff. And so I don't need to be vetted anymore because I've already been vetted through Mike. I spend less time on my end having to qualify the client, having to vet them, having to make them get on board with me because I've already been vetted through you. So you have to learn how to receive and reciprocate authority within your space. So I'd do the same thing for you. I'd say, hey, if you're looking for a loan guy in Texas, this is the guy you need to talk to. You have to learn how to receive and reciprocate authority in your space.

Mike Mills [00:54:28]:

Yeah, no, those things are all that's absolutely talk about that stuff all the time. The more time you engage and the more time you spend communicating with people, you can call it building an audience, you can call it whatever you want, but that is always going to do a benefit to you. And I think especially we see it a lot in the real estate world where people will go online agents and even mortgage lenders and anybody that does our job well, they're like giving a commercial for themselves on social media. It's like, hey, call me if you need to buy or sell your house, or call me if you need to do your loan or whatever the tagline may be. The truth is, I don't think and I think the statistics would bear out that that's not the way to approach it. You have to become the expert on the subject. You have to become somebody who's willing to just give the information without expecting something in return, the reciprocity thing that you're talking about. And you have to engage with people on a regular basis in order for them to see and think of you when it comes time to make that decision.

Ryan Bakke [00:55:28]:

Because do you know who the best person to sell you or your product is?

Mike Mills [00:55:33]:

No, tell me.

Ryan Bakke [00:55:35]:

Someone else.

Mike Mills [00:55:36]:

Yes. There you go.

Ryan Bakke [00:55:38]:

It's way easier for somebody to say, hey, I'm a client of Ryan's, or you really need to go talk to Ryan because he can do X, Y and Z than it is for me to try to engage that person and convince them to come on board. It's way easier for somebody else to sell you or sell your product than it is for you. It's just a basic it's not a persuasion tactic, but it's been around forever. I would also throw like one last little nugget in there, this idea of freezing your time. So a lot of times, whatever field you're going into, you're going to become an extreme expert at that craft to where you will find yourself answering those very basic beginner entry level questions there. The best thing I could recommend is just loom, video zoom, video podcast, whatever. Freeze your time, do it one time, and then you can just mass distribute that to people. I get people all the time. They'll have a question about something and I'll say, hey, go check out this podcast. Let's get on the same page here and then come to me with a little bit more of a sophisticated question and let me see how I can help you. But you have to be able to freeze your time, whether it's through podcasts, social media. I have courses that I make money on now that I sell to people that want to learn about real estate tax. Freeze your time, do it one time and just mass distribute it.

Mike Mills [00:56:51]:

Yeah, well, speaking of that, I was going to ask you because we're almost at an hour now, so time went by quick. So that's awesome. But I do want you to tell everybody about your coaching program or your seminars, what you run through, your business, and especially as it comes to structuring your real estate portfolio and how to put it all together because I know you do have some pretty great programs that you guys are offering now.

Ryan Bakke [00:57:13]:

Yeah. So I have just a basic you could find me on podcasts, learn like a CPA show. So if you really wanted to, you could learn every single thing by just listening to my podcast, but you would have to spend dozens, hundreds of hours learning it. But if you wanted to take the next level. So I have just basic courses for short term or long term rental investors, whether you're owning multifamily or short term rentals. And if you want to take the step up, there's a course plus an accountability or a coaching group where once you finish the course, it rolls you into bi weekly coaching calls with me so you'll be able to ask all your questions that you have or if you wanted to do one on one consulting. I also have that too, obviously at higher rates, but if you just go to learn like Acpa.com, you can engage and inquire about those.

Mike Mills [00:58:00]:

Well man, that is awesome. I really appreciate your time. Thanks for agreeing to do this with me. Just kind of out of the blue. So I got a ton of great information, but we'll definitely have to do it again sometime soon because I do think there's a lot more here. Obviously there's a lot more depth to it, but whether you're talking about short term rentals or long term rentals or multifamily, I know you do a lot of specialization and multifamily stuff so can't get to all of it at once. But I can't thank you enough for hopping on with me for a little bit and kind of digging into it and just let everybody know how to get in touch with you if they have any questions, where to reach you, all your socials, all that kind of stuff, and then we'll wrap it up.

Ryan Bakke [00:58:37]:

Yeah, so all social media platforms is going to be TikTok, Instagram, and Twitter. It's going to be at Learn, like a CPA, just like here in the handle. If you go on Facebook, it's tax strategies for real estate investors. We have a Facebook group with over 5000 real estate investors in there asking tax questions every single day. So make sure to check us out there and post a question depending on when this is released. I do like monthly just free webinars training, so for example, on Monday I'll be doing a webinar on how to analyze pro formas and financial statements.

Mike Mills [00:59:05]:

Okay, awesome. Yeah, I'll try to link some of the Facebook groups and stuff in the comments there too, so if anybody wants to go to and check it out, they absolutely can. Again, thank you very much, ryan, I really appreciate your time. This was great information and I hope you have a great week, man.

Ryan Bakke [00:59:20]:

Thank you. Awesome.

Mike Mills [00:59:21]:

See you guys.