November 18, 2025 • 52 mins
Taxes don’t have to be the cost of doing business. Specialized custodian Mikey Liello breaks down how self-directed retirement accounts let you buy rentals, fund flips, and lend privately — compounding gains with powerful tax advantages.
We simplify IRC 4975 so you understand what’s allowed, who’s disqualified, and how to structure deals legally. Learn the three clean funding paths — cash, non-recourse leverage, and partnerships — and why the solo 401k is the real estate investor’s multi-tool for tax-free growth, liquidity, and avoiding UBIT.
Plus:
• What the IRS allows vs. what custodians offer
• Prohibited transactions and disqualified persons
• Cash, leverage, and partner funding structures
• Roth conversions, backdoor Roths, and step plans
• How to turn old 401ks into private money for your deals
• HSA and CESA strategies
🎧 Ready to keep more of what you earn? Hit follow, share this with a friend sitting on an old 401k, and grab your free “BRRRR for Beginners” course to land your first deal in 45–90 days.
📩 Contact Mikey Liello: mliello@irastc.com
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_01 (00:40):
What's up, everybody?
Welcome back to another episodeof the Wisconsin Investor.
I'm your host, Corey Raymond.
Today we got a really greatguest here.
I'm excited to get him on uh andintroduce him here in a second.
Before I do, though, like I doon every episode, guys, we're
gonna talk about uh somethingthat we want to highlight or
sponsor.
And so we always talk aboutWisconsin discount properties as
(01:00):
our sponsor.
And I've been talking a littlebit about some giveaways that
we're doing here, some value addthings.
So hang on till the end of theepisode.
I'm gonna talk about uh somefree tools that we have for you
guys to really help make sure ifyou're looking to grow your real
estate portfolio, that we canset you up for success with
that.
So, with that, let's get intoday's episode.
(01:22):
I got Mikey Liello with me.
What's up, Mikey?
SPEAKER_02 (01:26):
What's going on?
How are you doing today?
SPEAKER_01 (01:28):
I'm doing great.
I'm doing great.
So Mikey and I met at a uh TimBratz mastermind event uh not
too long ago.
And I've known uh Edwin fromyour company for quite a while
from Collective Genius as well.
Um but we were chit-chatting alittle bit and having some good
dialogue.
And uh and Mikey, I'll let youintroduce yourself and who
you're with and all that sort ofstuff, and then it'll make sense
(01:50):
of why we have you on here todaya little bit.
SPEAKER_02 (01:53):
Yeah, so uh my name is Mikey Liello with a
specialized trust company.
Uh what we do is we areself-directed retirement account
custodians.
So essentially we teach you howto prevent some taxes, create
some tax-free passive income,and basically secure your legacy
wealth.
SPEAKER_01 (02:11):
And as Mikey just mentioned, tax-free.
Uh if you guys have beenlistening to any episodes with
me, you know that one of myfavorite things in this world is
to legally pay as little amountof federal tax as possible.
And so Mikey's got some coolthings here that we can do that
sometimes can sound kind ofconfusing, maybe overwhelming
for people.
And you know, we'll dive intosome of those different vehicles
(02:32):
and talk about how they can umbe beneficial.
But Mikey, talk first of all,self-directed.
Can for the people that havenever heard of that before,
maybe they've got an IRA or a401k or something like that
right now through an employer,or maybe they have uh had they
got you know legacy from aprevious employer or something
like that.
Talk about the differencebetween that IRA or 401k and
(02:54):
what specialized trusts helpspeople do.
SPEAKER_02 (02:57):
Absolutely.
So this is essentially what theretirement accounts are supposed
to be, in my opinion.
Okay.
Um, not even my opinion, it'sthe IRS's opinion as well.
So essentially, when it comesdown to it, most people think
when you have like a 401k withan employer, like you said, like
an IRA, let's say, you know,with the traditional type of
(03:18):
fiduciary, it's stocks, bonds,mutual funds.
That's the only things that youcan invest in, right?
Not true.
So when it comes down to theretirement accounts themselves,
it comes down to this.
So it's a tax code.
IRC 4975.
So that's like our Bible, right?
Okay.
(03:39):
Now, when it comes to the ruleitself, it actually comes to
this IRA owners can invest intoalternative investments, i.e.
real estate, but IRA custodiansdo not have to offer it as an
investment option.
Uh so here's the fun stuff.
Are they lying to you?
Not necessarily.
(04:00):
They just kind of are justomitting a little bit.
Yeah.
Lying to omission.
Yeah, I mean, here's the thing.
They they want to use yourcapital.
That's what they wanted to be inStock Bonds mutual funds.
Um, because if you were toinvest in 123 Main Street, they
can't take any kind ofcommission off of that.
So here's the only things theIRS says that you cannot invest
(04:24):
in antiques, collectibles, lifeinsurance policies, S
corporations, and alcohol.
Those are your only limitations.
Okay.
Now, when it goes into who youcannot invest in, that's a
little bit more complex.
We'll get into that in a minute.
Okay.
Um, but when it comes to it, andthe whole purpose of actually
(04:45):
retirement account investing isthe fact of retirement accounts
earn tax-free.
So if it's going to be in thestock market and things along
that line, most people don'teven notice that.
Right.
Right.
So the gains are not actuallygoing to be like, oh my God,
it's tax free.
This is amazing.
(05:06):
When it comes to a situationwhere let's say real estate,
yeah, well, those profits aresignificant.
So what's better than thosesignificant gains?
Tax-free.
SPEAKER_01 (05:16):
Tax-free.
SPEAKER_02 (05:18):
Yes.
So what you're able to do is ifyou have all 401ks uh from like
previous employers, TSPs, right?
So for your uh military umaudience.
Okay.
For 403Bs for the teachers andthe state employees, those can
actually be moved and any IRAcan be moved into a
(05:41):
self-directed retirement accountand be directly invested into
real estate.
Okay.
Or alternative investing orprivate lending, buying land,
you know, all of thoseinvestments are allowed to be
invested directly.
And then again, tax-free.
SPEAKER_01 (05:58):
Wonderful.
Wonderful.
So let's talk a little bit aboutum the just self-directing in
general.
You mentioned there's some whoyou can't invest with, right?
Talk a little bit about some ofthe rules with that, because I
think this is a uh clarifyingpoint.
Like you got to know the rules.
You don't want to blow up yourIRAs or your 401ks, right?
And what I mean by that isbasically if you do something
(06:18):
wrong, the IRS could come andsay, eh, nope, this is no longer
a tax-free vehicle, right?
You got to pay the tax and thepenalties and all that stuff.
So it is important to make sureyou understand some of these
things.
But tell us a little bit aboutlike what are some of those kind
of just general rules of thumbwhen you're looking at like,
say, I've got a I've got a sell,I've got something I transferred
over to you guys, you help putit into a self-directed account.
(06:40):
Now I've got an investment Iwant to use it in.
What are the do's and don'tshere of making sure I'm doing
this by the book and and notblowing this thing up?
SPEAKER_02 (06:48):
Yeah.
So we covered what you cannotinvest in, right?
Now, it's important to know whoyou can't invest in.
So basically, here's the rule ofthumb.
Up and down the family tree, youcannot invest in those
individuals.
Okay.
So you cannot invest in your umin your grandparents, in your
(07:10):
parents, in yourself, in yourspouse, in your kids, in your
grandkids.
Okay.
Okay.
Side to side in the family treeis fine though.
Brothers, sisters, aunts,uncles, cousins, completely
okay.
SPEAKER_04 (07:21):
Oh.
SPEAKER_02 (07:22):
Now the key word in that though is investing in.
Okay, so just want to plantthat.
Just everybody just rememberthat keyword.
Yes.
Um so what can you do?
There's essentially threedifferent ways that you can
invest a retirement account.
Okay.
One is outright.
(07:43):
Okay.
One, two, three, main street.
I want to purchase thatproperty.
It cost me a hundred grand.
I have a hundred grand in myaccount.
I purchased that property in thename of the account, all the
profits go back into the accounttax rate.
SPEAKER_00 (07:57):
Okay.
SPEAKER_02 (07:58):
Okay.
Simple.
SPEAKER_00 (08:01):
Yes.
SPEAKER_02 (08:01):
Now, the second is actually going to be leveraging.
So leveraging is completelydifferent.
So you can actually, let's sayyou don't have a hundred grand
in your account, you can borrowin the name of the retirement
account, execute the investment,and then all the profits come
back tax-free.
(08:23):
Now, keyword on that though,there's a very uh specific type
of loan, though.
It has to be a non-recourseloan.
Okay.
Because remember, you're notgoing to be the investor.
The account is.
SPEAKER_00 (08:34):
Right.
SPEAKER_02 (08:35):
So you can't actually personally back it.
SPEAKER_00 (08:37):
Right.
SPEAKER_02 (08:38):
Now the third one, we're going to go back and
circle back to that investing insituation.
So most people have multiplegoals of what they're trying to
accomplish financially.
So especially for families,right?
So you have yourself, you haveyour business, you have the
(08:59):
kids, you have kids' educationgoals, all of these different
things.
That's why we're that's whywe're grinding so much, right?
Right, right.
Retirement accounts and this orself-directed retirement
accounts, it's better to thinkabout them like they're
financial tools.
Okay.
Okay.
Because you have the controlover it and you only have to
(09:21):
listen to what the IRS says.
Okay.
So let's say, for example, youhave um children in private
school.
SPEAKER_04 (09:29):
Okay.
SPEAKER_02 (09:30):
Now, in that situation, okay, now I have to
earn more, get taxed on it, andso I can pay for this education.
Wouldn't it be better if I had afinancial tool that would just
pay for that on its own?
That there is accounts.
It's called a CISA account,Coverdale Education Savings
Account that can be investedinto real estate and actually
(09:51):
will earn tax-free.
SPEAKER_04 (09:52):
Okay.
SPEAKER_02 (09:54):
You also, for the sake of legacy, set up a Roth
IRA for your kids.
And it will, you pay them, andthen they have a Roth IRA.
How amazing would that be if youwere actually, you know, if all
our parents did that?
SPEAKER_01 (10:11):
For sure.
And a Roth IRA, for those thatdon't know, is a tax-free
investment investmentretirement.
SPEAKER_02 (10:19):
Um so here's the difference between just to kind
of plant it.
Tax deferred dollars is greatfor now.
So tax deferred or traditionalaccounts, um, that basically
money put into that account,it's gonna be a tax write-off
for either yourself or for thebusiness.
SPEAKER_04 (10:38):
Okay.
SPEAKER_02 (10:39):
Now it will earn tax free, but then one day you're
gonna have to pay taxes on thegrowth.
Now the Roth is gonna be theopposite.
Roth is, I don't want the taxbreak right now.
It's gonna earn tax free, andthen it's tax-free forever.
Yeah.
So you gotta love that.
And it is down tax-free.
(11:00):
So setting up like a Roth and aCISA account for the kids, it's
very functional, plus it's alsolegacy.
Now when it comes down to thebusiness, of course, we want to
save as much taxes still today,right?
The Roth is great for later on.
But there is an account called aRoth solo 401k.
(11:22):
Okay.
Or just a solo 401k.
And what that does is it allowsyourself to set up a 401k in the
name of your company.
So you're basically gonna be theemployer and the employee.
Okay.
Now that 401k and you have theRoth account set up for the
(11:45):
kids, right?
And then you have the CISAaccount.
So now you're covering yourself,you're covering the business,
and you cover the legacy.
Now remember what I said youcan't invest in each other,
right?
But you can partner.
So if you have all thesedifferent financial tools in
place and you structure thedeals accordingly, which we we
(12:06):
can help you with, um that isthe way that you can actually
multitask with those differentfinancial goals and have them
all be growing tax-free at thesame time.
SPEAKER_00 (12:17):
Interesting.
SPEAKER_02 (12:19):
And you're not wasting the one thing that I
always tell everybody is thatwhen you are actually paying
attention, you're utilizingthese different self-directed
tools that is available foreveryone.
That you are doing somethingthat not many people can't or
know about, but you're savingthe time to get to your
(12:40):
financial goal.
Because time is the only thingyou can't get back.
So if you can prevent the tax,you're gonna reach your goal a
whole lot faster.
And these are tools that you canactually implement.
SPEAKER_01 (12:53):
That's amazing.
So you can take your you're whatyou're saying, I just want to
clarify this and land the planehere a little bit.
You're you can take that RothIRA in your name, you could take
uh solo Roth 401k in your name,or in the company's name, as you
said, and you can partner thoseon a deal, 50-50, let's just
call it.
If they both have 50,000 forthis, 50,000 for that, boom,
(13:16):
they partner now.
Now they earn 50% of each goesback in for the profits, and the
growth that earns tax-free.
Wow, I didn't realize that.
See, I always thought I'm thisis why I have you on here,
Mikey.
I always thought you that's ano-no, that's a prohibited
transaction, is what I thought.
SPEAKER_02 (13:30):
If you invest in each other, got it.
SPEAKER_01 (13:33):
That's the key word.
My Roth can't own it, and thenmy 401k lends capital to it, is
what you're saying.
SPEAKER_02 (13:41):
They have to that's exactly right.
SPEAKER_01 (13:42):
Got it.
They have to be joint venturepartners in a sense, or LLC set
up with those two as 50% ownersin each.
Yeah.
Can it can it be separate?
Could it be 35%, 65% ownership?
Okay.
So it doesn't have to be 50-50.
SPEAKER_02 (13:57):
It just needs to be represented monetarily.
So basically, you can have it towhere um I'll give you a
scenario.
So let's say that you have afamily of four, right?
And kids go to private school,kids want Roth IRAs, they're
smart kids.
Um and then so the parents havea solo case set up.
(14:19):
Okay.
So you can have it where dad andmom, let's say, are 40% of this
deal, right?
So 40 and 40.
And then you have the kids,which are 10 and 10 represented.
SPEAKER_04 (14:34):
Okay.
SPEAKER_02 (14:34):
Right?
To make it easy, what you woulddo is that all those think of
them as entities, not asretirement accounts.
Think of them as like these arebusiness entities.
SPEAKER_04 (14:46):
Okay.
SPEAKER_02 (14:46):
They're all going to be members of one brand new LLC.
And then that LLC makes theinvestment.
SPEAKER_00 (14:55):
Nice.
SPEAKER_02 (14:56):
So you can customize the percentage however you like
to.
There's not, it doesn't have tobe 50-50 in any way.
SPEAKER_01 (15:01):
Okay.
All right, cool.
With a structure like that, howare like I'm just trying to
think through likebookkeeping-wise.
Like that to me sounds like itmight be a bit of a challenge,
right?
Or maybe a pain in the butt.
What are you seeing from clientsdoing some of this stuff?
Like, how are they keepingeverything, you know, by the
books and making sure thedistributions are appropriate
and all that sort of thing?
Is it is it easy?
(15:21):
Is it simpler than I'm thinkingit's going to be?
SPEAKER_02 (15:23):
It's a lot, it it seems like this is the thing I
always tell everybody when itcomes down to self-direction and
then the different strategies,is that it seems like it's very
complicated and difficult.
But really, in nature, uh in itstruest form, it's really very
simple.
It's actually much lessterrifying than actually having
(15:45):
like a traditional type ofaccount because there you have
no control.
SPEAKER_00 (15:49):
Yeah.
SPEAKER_02 (15:50):
Um when it comes down to what we do very well, is
basically it's like kind oflearning a new language, and
you're we're just thetranslators to help basically
kind of navigate you through toget you to where you want to be.
SPEAKER_04 (16:04):
Okay.
SPEAKER_02 (16:05):
Um, and that's the kind of the reason why, you
know, every single time I talkto any client, it's about what
are you trying to accomplish?
Because then you know whichaccounts that you would um you
would want to open up and youknow why.
SPEAKER_04 (16:18):
Right.
SPEAKER_02 (16:19):
So um when it comes down to how to actually
structure it, you know, we'llguide you through that process.
Okay.
As passive custodians, weprocess the investments, we hold
the investments.
Um, but as at specialized, wereally try to be the investors'
custodian.
So we want to basically guideyou through, reverse engineer
(16:41):
what you're trying toaccomplish, and then you know,
teach accordingly.
SPEAKER_01 (16:44):
Okay, cool.
Yeah, because I know there'ssome companies out there, trust
companies, they won't they won'treally get on the phone, they
won't give you any advice, theywon't talk you through how to do
anything.
You're saying you guys arespecialized, you guys will will
hold some hands a little bit, iswhat I'm hearing here, Mikey.
SPEAKER_02 (16:58):
Yeah, there's just not a lot of like educational
tools out there to kind of guidepeople when it comes to
self-direction.
SPEAKER_04 (17:06):
Right.
SPEAKER_02 (17:06):
Not a whole lot of people.
We were just actually at anevent in Dallas, and it's funny
because I was sitting at a roundtable, and I'm leading this
round table, and I know thatthese people have been doing
real estate investing fordecades.
And I'm talking to them aboutself-direction, and it's the
first time they've actually everheard of it.
(17:29):
Which is wow.
When it comes to real estateinvestors, this should be I this
is an ideal tool for you.
SPEAKER_01 (17:36):
For sure.
Well, and that's why I wanted tohave you on here because I feel
like I've known about it becauseof some people locally that were
already doing someself-direction when I got
started at some of the localmeetups and that kind of thing.
They were already talking aboutsome of these things.
But for a lot of peoplelistening to this, they may have
never this might be the firsttime they're like, wait, wait a
minute, what the hell isself-direction versus this and
all this sort of thing?
And that's why I thought, hey,let's introduce that topic to
(17:58):
the audience today after meetingyou, Mikey.
I'm like, hey, this would begreat for us to to to jam out on
a little bit because it is aawesome vehicle and it's a tool.
Like you said, it shouldn't beit shouldn't be every deal
you're doing is in your IRA, butand I mean maybe if that's your
strategy, it's it's an I thinkthat's a tool for yeah, exactly,
because you know it does it doesa couple different things,
(18:20):
right?
SPEAKER_02 (18:20):
So um, like solo 401k.
Solo 401k, one of the reasonswhy it's such an important tool
for real estate investors, it'sa way that you can write off
46,500 for 2025.
Okay.
SPEAKER_01 (18:36):
And that's what from your business, I could take it
from my business, put it intothe solo 401k, I write that off.
SPEAKER_02 (18:43):
Correct.
And then so 2000, if you guysare looking for tax write-offs
for 2025, get started becausethat has to be established for
before the end of the calendaryear.
SPEAKER_04 (18:54):
Okay.
SPEAKER_02 (18:55):
Um now on that same front, so that's your tax
deferment contribution.
Okay, but you're still anemployee of that same um
company, right?
Right.
You're the employer, you're theemployee, you pay yourself.
Yep.
So with that in mind, you canactually contribute up to 23.5
over the age of 50, you can do31 directly to your Roth.
(19:19):
So now you have the best of bothworlds.
So that's kind of like theflexibility when it comes to um
solo K is a great example, justbecause it's kind of like a
financial multi-tool in a lot ofways.
Okay.
Um because with the same, let'ssay that you need some like
household or you just need somecapital for private use, right?
(19:39):
Let's say you have an old 401kfrom an old employer, you move
that and it's called a rollover.
It's not a taxable event, it'snot gonna be something you're
gonna get penalized for.
You just move it from house tohouse.
Now, within that new 401k,though, that you just set up for
yourself, you can borrow up to50,000 unrestricted.
(20:00):
So that 50,000 doesn't followany rules.
It's an unrestricted cash uhloan.
Oh.
And you're gonna pay yourselfback with interest.
SPEAKER_01 (20:09):
Okay.
So now you're writing off.
Is there a rule of like how muchinterest you can charge
yourself?
Because then that that interestis tax deductible, right?
If you're writing it off as anexpense to your 401k?
SPEAKER_02 (20:21):
Well, it it's not gonna be um attached write-off
because there's no tax applied.
So it's tax-free and it doesn'thit your credit, and it's prime
plus two that you're payingyourself back.
SPEAKER_01 (20:32):
Prime plus two.
Okay, but that prime plus twopercentage, I'm saying, is that
gonna be tax deductible, thatinterest that you're paying
yourself back?
SPEAKER_02 (20:40):
It will not be.
No, it won't be.
Yeah.
SPEAKER_01 (20:43):
Okay.
It's just going back in to helpthat investment grow.
Okay.
Got it.
What are some of the reasonspeople don't do a 401k, for
example, or a solo 401k?
Like, is it are there certainrules, restrictions, is there
like what are the lockup rulesbefore you can touch it, like
all that kind of stuff.
Talk a little bit about that.
SPEAKER_02 (21:00):
So 59 and a half is that age that you have to uh you
have to wait until 59 and a halfto actually pay make a
distribution, is the wording,without uh gonna be penalty.
And if it's Roth, then it'sgonna be tax free.
SPEAKER_04 (21:18):
Okay.
SPEAKER_02 (21:19):
Now, with a solo 401k, the only restriction that
you have is that you cannot havefull-time W-2 employees.
So that's your restriction.
Now you and your spouse can beparticipants, okay?
Okay so you can pay yourself,you can pay your spouse, but you
(21:39):
just can't have any other W-2employees.
Got it.
SPEAKER_01 (21:42):
Okay.
So it wouldn't work for menecessarily.
Otherwise, what is the rule?
Don't you have to offer it toeverybody if you offer it if you
have one yourself, then you haveto offer it to everybody, or
there's some some somethingabout that type of rule, right?
SPEAKER_02 (21:55):
Yeah, correct.
So for like your situation, itmight be um more advantageous to
go with like a SEP or a simple.
Um, so for those ones, you'rekind of going into the weeds a
little bit, and anybody who'sactually interested, who has W2
employees, um, just go ahead andget a hold of me.
I'll kind of I'll lay it downfor you.
But with um there's always gonnabe an option.
(22:17):
It just depends on what thesituation is.
Okay.
So saps and simples are yoursecond, third place, basically.
SPEAKER_01 (22:26):
Okay.
Got it.
Okay.
Yeah, I knew there was somereason we we didn't do one of
those over the years, and itmust be because of that W-2
requirement or whatever that is,right?
SPEAKER_02 (22:37):
Yeah, it might be something that we uh probably
want to revisit just to becauseyou have you always have a
possibility when it comes downto these accounts to actually
establish something for the forthe um company itself, but it
just needs to be matched upright.
SPEAKER_01 (22:54):
Cool.
One one thing I'll talk abouthere too, Mikey, is we're still
talking about tax-free.
One of the my favorite thingsthat we've done over the years,
and now it's changed a littlebit because we have employees
and I'm not in the day-to-day asmuch doing these deals, but we
have done deals in ourself-directed HSA account.
Mm-hmm.
And wholesaling a deal for us,it was really it's a really
(23:17):
great way to grow tax-free moneythat you can then use.
I mean, I know I'm gonna usemoney on healthcare, probably,
you know.
I'm not getting what I'm notgetting.
Yeah, right.
Uh so talk a little bit aboutHSAs, self-directed HSAs.
What can you use that money on,right?
So for the people out there whomaybe have never heard of this
(23:38):
HSA thing, how do you get one?
Like those types of things, andthen I can kind of I'll share an
example of the wholesale deal wedid in our HSA.
SPEAKER_02 (23:46):
Going back into kind of how you know, these are just
tools.
Um now going into like the let'stalk about the family plan, kind
of going backwards a little bit.
So with our example, we had theuh the fan the company taken
care of, we had mom and dadtaken care of, kids' legacy, and
then you know, kids' educationis taken care of, right?
(24:09):
Now, to make sure that youbasically are going to be able
to you utilize every tool thatyou can is that you can have,
which most people are aware of,you know, you can have an HSA,
but you can self-direct it.
And so an HSA, it earnstax-free.
So, for one, whatever money youput into the HSA is tax
(24:32):
deductible.
So it's a tax write-off.
So you gotta love that.
Now it will earn tax-free and itwill spend tax-free on any
qualified health cost.
So now you covered all acrossthe board.
Every single thing that youactually are doing real estate
for and what you're trying toafford for your family, it's all
being taken care of.
(24:53):
So I always qualify the CISAaccount and the HSA, those are
your necessary costs of life.
Right?
So health and the kids'education, no matter what, you
probably're gonna have to spendsome money on that eventually.
So now you actually, instead ofactually having to earn more,
getting taxed, and afford thosenecessary costs of life, you
(25:14):
have these tools in place andthey're part of your structure.
SPEAKER_01 (25:17):
Yep.
Yep.
So HSA's how what are there'ssome ri rules about who can get
one, though, isn't there?
Like, don't you have to have acertain type of uh insurance
plan or something like that inorder to be able to qualify to
open one if you don't alreadyhave one?
SPEAKER_02 (25:32):
Most investors actually Or contribute.
Yeah, so most investors reallydo um without them knowing they
qualify for an HSA.
So your only thing is the factthat you have to have a high
deductible health insurance.
Okay.
So that's your only qualifying,you know, the difference between
(25:52):
like W-2 employees that youmight have an employer who
actually you know offers yousome great health insurance, so
therefore you can't have an HSA.
SPEAKER_03 (26:00):
Yeah.
SPEAKER_02 (26:01):
Um but most and entrepreneurs, they're kind of
set up in that high deductibleworld.
And so the HSA is perfectbecause then that'll offset you
know most of your, or if notall, of your health costs.
SPEAKER_01 (26:14):
What do they what do they define as high deductible?
SPEAKER_02 (26:17):
Um, it's gonna go off of basically what the
household is.
So um I think they actually kindof changed it this year.
Um I'll look that up.
I'll get back to you on thatone.
So the high deductible plan.
Let me see here.
SPEAKER_01 (26:33):
Yeah, I knew there was something, but here is
here's one of the things, Mikey.
Correct me if I'm wrong.
If you already have an existingHSA account from say you worked
at a place or you had a highdeductible plan, now you got a
new gig or new your companyswitched insurance plans to a
low deductible.
As long as you still have thataccount, you can still
self-direct that, correct?
SPEAKER_02 (26:52):
Correct.
SPEAKER_01 (26:53):
You just can't contribute to it.
SPEAKER_02 (26:55):
Correct.
That's that is absolutelycorrect.
So with a uh an HSA, so you anyHSA that you had previously can
be transferred.
So that's gonna be another oneof those keywords, right?
Because it's not gonna be ataxable event, it's just gonna
move from house to house.
SPEAKER_00 (27:11):
Yeah.
SPEAKER_02 (27:11):
And now it's able to be invested in what you're
looking for and what you'retrying to accomplish.
SPEAKER_01 (27:17):
Yeah.
So here's an example, guys.
I I used to work for a companypre private previously, uh, and
we had high deductibles, so wecould set up HSA.
So I I was contributing theamount, I think at the time it
was like six or seven grand fora family or something.
So I would contribute that tothe HSA, which again is a tax,
tax-deductible event.
And then um I I found out Icould self-direct this and
(27:39):
actually invest that money inthe HSA.
I thought it was just a savingsaccount, right?
That's what it's labeled at.
So I was like, oh, I don't know.
I'll like I'll just keep themoney in here and then I'll just
spend it down every year, andthen I'll put more in next year
and I'll spend it down.
And uh then I learned aboutinvesting it.
And then I realized for for us,for example, a wholesale deal,
when I was more active in theacquisition side of things, I
(28:01):
would do this at least a coupleof these a year, where I would
lock up a deal, I would give theseller some kind of earnest
money.
And I so when I locked it up,instead of it coming from my LLC
as the buyer, I put down my HSA,FBO, whatever the thing is that
I had to put down on my offer topurchase, I would get some
earnest money, and then I wouldhave the uh custodian send that
(28:24):
earnest money to my seller, andthen I sell this thing, and in
45 days, let's say I made$20,000on this wholesale deal.
I invested$100 and I got back$20,000 tax-free into my HSA
account that I can now use forwhatever I want, health
reasons-wise.
It's got to fit within certainparameters.
SPEAKER_02 (28:44):
Any qualified health cost, which is it's a long list,
just you know.
I mean, it's very expensive.
SPEAKER_01 (28:49):
Right.
Like chiropractors,orthodontists, dentists,
doctors, medicine with it now.
Yeah, that's right.
Any yeah, you can go toWalgreens, you get your
medicines, you're you can getointments, all that kind of
weird stuff you can use your HSAfor.
SPEAKER_02 (29:05):
I remember uh driving to the office during
COVID time, and I was last weeklistening to like terrestrial
radio, and uh the Musinexcommercial came on, and at the
end of it was you can now useyour HSA for Musinex.
And I'm like, Oh really?
Oh wow.
Yeah.
I'm the only person listening tothis and going, Oh, okay.
(29:28):
All right, now I got some morestuff to talk about.
SPEAKER_01 (29:30):
That's right.
That's right.
That was one of my favorite whenI when I realized that I'm like,
wait, I can do, and this istotally legal, there's no issue,
and I like I had this epiphanymoment of like, oh my gosh, I'm
gonna spend money on healthcareno matter what.
I might as well make ittax-free, right?
That was kind of my top process.
So, those of you guys out therelistening, let's say you're, you
know, maybe you're notwholesaling, but maybe you're
flipping and you've got a goodchunk saved up in your uh in
(29:52):
your HSA account.
You can use that money to doyour flip, and then you put the
profits back in.
Now, Mikey, question for you.
A lot of people aren't gonnahave enough capital, let's say,
to do a flip.
Is this one of those scenarioswhere they could partner with an
LLC?
They could have their HSApartner with themselves.
Can they partner with themselveson the deal?
SPEAKER_02 (30:12):
So you can't partner with yourself on that one
because yeah, that's gonna be alittle that's muddy.
So you don't want to kind ofmuddy the waters when it comes
to that one.
So you um like a lot of thetimes when it comes to the
conversation I have with like my101 clients is you know, let's
figure out the overall plan umand just base it off of that.
(30:33):
So just base off of what yourgoals are and then just reverse
engineer from there.
So Like, for example, I I have aclient who kind of similar to
you, uh, just different vehicle.
He has four children in privateschool in j in uh Jacksonville
at twenty thousand dollars apop.
(30:54):
That's a large check, and it'skind of not the most favorite
time of the year for them towrite that tuition check, right?
Um, or it wasn't at the timebecause same thing, you can
actually prioritize some kind ofdeal structure accordingly.
So now he does four deals ayear, wholesales out of those
(31:15):
CISA accounts.
So therefore, instead ofactually, and what he did, and
you know, similar to like withyour HSA, he's not earning more
to afford his necessary cost oflife, right?
He is actually structuring thesedeals to make sure his tax
liability is not gonna go up sohe can pay for things that he
(31:36):
wants to pay for.
Right.
So now you're eliminating thetax problem at the same time
that you're actuallyaccomplishing your goals.
SPEAKER_01 (31:44):
For sure.
Well, and you're keepingyourself in a lower bracket,
right?
So not only are you not payingtax on income, you're keeping
all of your other income in alower bracket.
Exactly.
Because you're not paying that,yeah.
That makes a lot of sense.
SPEAKER_02 (31:56):
You're not sacrificing anything.
SPEAKER_01 (31:58):
No, not at all.
Exactly.
SPEAKER_02 (32:00):
So life's good.
SPEAKER_01 (32:02):
So talk, let's talk through a flip scenario because
I have a lot of flippers thatlisten to this.
How could a flipper structuresomething like an HSA and their
CISA and some of these things?
Like, how would they do that?
Let's say they're, you know,they're just starting out, they
just opened some of theseaccounts in the last couple
years, they don't have a lot ofuh capital built up in it per
se.
What's what's kind of a creativeway they could maybe utilize a
(32:23):
smaller amount of capital insome of these accounts besides
wholesaling?
Again, I know the wholesale wentpretty easy.
Yeah.
Talk about like a flip.
How could we structure a flip?
So maybe a couple differentways.
SPEAKER_02 (32:35):
Yeah, so a couple different ways.
So let's say that you have likeold retirement accounts from
previous employer, right?
So uh mom and dad, you know,they both had previous lives,
they you know had different uhjobs.
So that's the one thing that Ithink a lot of people don't
realize is the fact that theyhave complete access to those
(32:56):
accounts.
It's still your money, right?
It's just a matter of you thinkand everybody's told you that
it's locked up where it is andit's monopoly money.
Who cares about it, right?
So when it comes to actuallymoving it, not gonna be a
taxable event.
I don't care what your financialadvisor told you, that you just
they just said they just don'tthey omit when it comes down to
(33:18):
oh, if you take money out,you're gonna get taxed and
penalized.
True.
If you actually just took adistribution, that's right, but
you're not doing that, you'removing it.
Okay, so now you have untappedcapital that's now funding your
solo 401k, for example, and youwant to open up accounts for the
kids.
So you can partner all of thosedifferent accounts, including
(33:40):
the HSA, partner them alltogether.
So now one account, let's say,didn't didn't have enough
capital, but combined, theycan't.
So that's a way that you canactually deal structure
something.
So let's go back to thepartnering.
Now, let's just say that mom anddad are just trying to go with
using their they want to takecare of their um 401k, they want
(34:03):
to make that grow.
They basically they've uhthey're trying to catch up for
time, right?
Now the solo 401k is uniqueagain because it's the only
account that you can actuallyborrow in the name of and if you
avoid what's called a UBIT tax.
(34:24):
So unrelated business incometax.
So deal structure number two isleverage.
So you don't want to pay anymore taxes personally, you want
to have this fix and flipbecause you know it's gonna be
um tax-free forever because it'sgonna be in your Roth account.
All those scenarios,everything's great, but you
don't have the capital inside ofit.
You can leverage and avoid thatU bit tax.
(34:47):
So U-bit tax basically is kindof one of those ones where um
everything seems great in theworld, and then all of a sudden
the government had another idea.
Um, but this is the way that youcan do that.
So that's that's why that solo Kis also very important because
it does avoid that.
And most flippers will love thatsituation.
(35:07):
Okay.
unknown (35:07):
Okay.
SPEAKER_01 (35:09):
Talk about U-Bit tax for a second, Mike.
You can go on to the otherpoint, but uh, we can circle
back to U-Bit tax.
But I do want to talk about thatbecause that's always kind of
been a uh cloudy thing in mybrain of understanding U-Bit.
Okay.
SPEAKER_02 (35:20):
Um yeah, it's one of those ones where the government
doesn't want you to operate abusiness inside of your
retirement account because it'stax-free, right?
Okay.
So an IRA can be subject to UBITtax.
Okay.
Okay.
401k is not really.
Now, when does it kick in?
We don't know.
Like no one actually there's nota set number of deals that you
(35:43):
can have like in an IRA beforeUBIT tax kicks in.
So it's it's so cloudy.
It's just a matter of wheneverit pops up.
That's why, okay.
If you have a 401k, you'reyou're happy.
Um, inside the IRA, you justwant to kind of it could be
four, it could be five.
It's there's no set rule in thetax code to kind of like this is
(36:04):
what it does.
SPEAKER_01 (36:04):
It's just when they're somebody's doing a deal
a year, they're gonna be fine.
Right?
Yeah, is there a certain dollaramount like gain on their
investment that triggers it, oris it there's really not.
SPEAKER_02 (36:15):
It's it's so and it's such an interesting rule
because it's so vague.
Um and then so when it kicks in,it sucks.
Uh you know, it's 37%.
Um so it's a matter of if youcan apply uh if you qualify for
the solo 401k, set the solo401k.
(36:36):
Okay.
That's that's your your bestfriend right there.
SPEAKER_01 (36:38):
Okay.
And if you want more info onUBit, maybe go to like ChatGPT
or something, research it up alittle bit.
SPEAKER_02 (36:45):
Yeah, you want to do that.
I mean, most people if you'regonna be in that situation,
you're flirting with that idea,talk it to uh your CPA tax
attorney just to kind of gothrough the details on that.
Um they might have a little bitmore insight, but it's just it's
such a random rule that thatjust kicks in whenever.
And it's basically kind of theidea behind it is that they just
(37:09):
don't want you to operate abusiness.
SPEAKER_01 (37:10):
Okay.
So one one thought I had as youwere talking, Mikey, before
about how do we how do westructure a flip or even
rentals, right?
You could do rental propertiesin these and create some passive
uh ongoing income coming intoyour into your retirement
accounts.
Uh let's say here's an example.
I've got a buddy, he's got agood amount of capital, right?
I've got a smaller amount ofcapital in my IRA or my 401k or
(37:35):
my HSA or whatever my CISA,whatever I want to self-direct,
right?
We decide we're gonna part we'regonna create an LLC with my
retirement, CISA, whateveraccount, and there.
So maybe it's 75, 25% ownership,something like that, right?
Flip side, they also have someretirement accounts over here
that are smaller amounts, and Ihave a bigger amount.
(37:56):
We could create a different LLCfor that, and we just trade
deals for say, okay, this dealwe're gonna do it under this LC,
this deal we're gonna do underthis LC.
And it's a way for us both tomaybe grow our retirement
accounts together and try tosplit that up.
And that's totally legal, noissues with that.
SPEAKER_02 (38:12):
Yeah, as long as you're not investing in
yourself.
That's that's the key word inthat.
So with that scenario, you justdon't want to be lending to your
own deal, like for example,right?
SPEAKER_01 (38:23):
So they would have to bring the capital for that
deal outside of anything that myretirement account had, or that
we we weren't leveraged.
But again, the leverage piece iswhere it gets tricky because
you've got a a lot of these aregonna be personal guarantees
that these lenders are gonnawant, right?
So it's gotta be a non-personalguarantee.
SPEAKER_02 (38:40):
Non-recourse.
Yeah, correct.
So here's here's a kind ofscenario for the here's your fix
for that.
Okay.
Um, a lot of people, I usuallysay it's roughly around 80% of
the room that has had has likeretirement accounts from
previous employers just around,right?
Okay.
That most people don't even knowthat they can access.
(39:03):
Um, it's monopoly money, right?
It's just not even a real thing.
Now, what they don't knowthough, is that all of you real
estate investors, you can borrowother people's retirement money.
And you can give them an actualreturn and they're gonna love
you for it.
And everybody wins.
(39:24):
Yeah.
Because it used to be a lazyasset and now it's not.
And so when it comes down tomaking sure that you can take
full advantage, um what it wasdoing before was nothing.
SPEAKER_03 (39:38):
Right.
SPEAKER_02 (39:39):
Now you're have you're having a new conversation
and you're saying, like, hey,you know, do you have old
retirement money?
Well, I have this deal, I'llgive you nine percent, I'll give
you whatever the amount that youdecide, because you get to
decide it.
And they're gonna be like, Oh mygod, that's way better than
(39:59):
whatever I've done before.
And then now you started aprivate money network that is
secured by a promissory note andyou made up the terms, yeah, and
you have a network that's nevergonna, you know, the next time
that there's a deal, would youthink they're gonna say no?
No, just like no, let's keep iton, let's double up, let's you
know, let's compound.
(40:21):
So for you guys who are learningum trying to raise private
money, then we should talkbecause you know, you start
those conversations.
We have plenty of clients whoare like this.
Is that you know, you start thatconversation and we'll talk them
through because it's gonna bescary and weird for them at
first, yeah, right?
(40:41):
Because who knows anything aboutthis stuff.
SPEAKER_04 (40:43):
For sure.
SPEAKER_02 (40:44):
But we do.
And so we'll guide them throughto give them all, you know, make
sure that they feel securebecause that's all this is tax
code.
Right?
SPEAKER_04 (40:54):
Yep.
SPEAKER_02 (40:55):
So when it comes down to that situation, you're
just basically telling them thisis what it should be like.
It just wasn't that way before.
Yeah.
But now it can be.
SPEAKER_01 (41:08):
So what Mikey's basically saying, guys, is such
a good point out there.
So if you're sitting here andyou're like, I I don't even want
to think about retirement rightnow.
I'm just getting started.
I want to get my first coupledeals, whatever the case is.
And it's a private money, right?
What Mikey's talking about isthere is a massive amount of
untapped money sitting inretirement accounts, not even
deployed, right?
Mikey, isn't it like somethingin the trillions?
(41:28):
Yeah.
SPEAKER_02 (41:29):
Yeah, um, I think it was 24 trillion, I think, last
time I checked.
SPEAKER_01 (41:33):
Literally trillions of dollars sitting in people's
retirement accounts, not evenworking right now.
It's just sitting there.
People kind of forgot aboutthat.
They even have it.
So Mike is saying, go go talk tothem.
They don't they don't want toput their own cash into it, but
they've got this monopoly moneysitting there that they, you
know, they're not reallyemotionally attached to.
It's kind of like, ah, it's justsitting here anyway, right?
SPEAKER_02 (41:51):
Yeah, it's good.
It's literally they're notthinking about it in any way
possible, right?
It's just something.
Imagine that you had, and thisis what comes up.
You know, you'll have a lot ofpeople like, uh, it's not even
that much.
It's like a hundred grand.
Okay.
If that was cash, you wouldn'tbe talking about it like that.
(42:13):
So true.
So, and so all you real estateinvestors, when you actually
think about that type of thing,or you hear that, those that
should make some like your eyesjust get real wide and you guys
get real happy because that's ahundred grand that you can use
for capital.
SPEAKER_01 (42:30):
Absolutely.
Yeah.
And you know, let's say thatperson has like their retirement
account sitting in Vanguard orFidelity or something, and
they're like, Well, I can't Ican't do it because it's in this
Vanguard Fidelity.
That's why you got somebody likeMikey here.
What Mikey's talking about isyou guys you connect with him,
we'll get his contact info andeverything in the show notes
here for you.
You contact Mikey, you say, Hey,Mikey, I got this client, they
(42:50):
want to move to self-directed,but they don't want to pay the
penalties.
What he's talking about earlieris a rollover, not a
distribution.
So Mikey will help them makesure that they do the rollover
properly.
So they're rolling it into asimilar account.
It's just instead of sitting intheir Roth IRA of Fidelity, it
is now sitting in aself-directed account, a
specialized.
And now they can now they can goand deploy that capital however
(43:13):
they want, as long as it's inthat, you know, not in the
alcohol business or whatever,you know, those those prohibited
ones we talked about earlier.
Don't be buying booze with it,right?
Uh, but they could do it in yourreal estate deal.
And they could be a privateinvestor basically lending to
you.
They're gonna be secured by thereal estate, by a promissory
note.
Their IRA is gonna be insured,it'll be insured on the property
(43:34):
and all those sort of things.
Make sure you do all thatcorrectly.
But that it's a much safervehicle for them.
Uh plus they're getting cap,they're getting a return on
their money and it's tax-free.
SPEAKER_02 (43:45):
Yeah.
It's amazing how it's just oneof those situations where you're
just taking control.
That's what you're doing.
And you're utilizing what youcan utilize.
Just just because it's unknowndoes not mean that it's not
allowed.
Yeah, that's you just have tohave those conversations.
Um, of course, you need to makesure to to listen to the rules,
(44:06):
but yeah, we'll we'll teach youthose.
Um, but when it comes down towhat the end result is, it's
tax-free forever wealth.
SPEAKER_01 (44:14):
Yeah.
Yeah, which is amazing.
So nine, your nine percent yourRoth.
I mean, I don't know what theconversion is if you had to pay
tax on that, but it's muchbetter than nine percent if you
look at comparatively speakingto a taxed nine percent return.
SPEAKER_02 (44:29):
So and the Roth is is always going to be something
that's gonna be king.
I mean, it's like it's basicallypaying tax on the seed, not the
crop.
SPEAKER_01 (44:37):
Yeah, that's a great analogy, by the way.
Last question I have for you,Mikey.
This is one I have uh stole thatone from Edwin.
I like that one.
That one's good.
Uh I I have a family member whohas an account invested in a
hard money lending fund.
So similarly, they're just notthe one they're getting a return
on their money.
They're just not uh the onedirecting which investments.
(44:57):
They just put it in the fund andthen that company goes and lends
that money out on their behalf,so to speak.
But one of their accounts is atraditional IRA.
And so they're they're wonderinghow can they get that into a
Roth?
Can you talk a little bit aboutwhat that process is?
And and I I believe there'ssomething called the backdoor
Roth.
Can you talk a little bit aboutthat?
SPEAKER_02 (45:17):
Yeah, so um backdoor Roths, or essentially, this is
one of the most prevalent thingsthat um I've heard so many times
throughout the years, is thatyou know, oh, I can't I can't, I
make too much, I can't have aRoth IRA.
No, that's not what it is.
When it comes down toestablishing a Roth IRA, it is
(45:42):
very much a situation where youcan establish it, but you might
not be able to directlycontribute to it.
Okay.
Okay.
So when that that happens, whatyou do is you establish a
traditional IRA, you contributeto the traditional account, and
then you can actually convertit.
(46:04):
Okay.
So conversion is the differentthat's what the rule of thumb
is, or not the rule of thumb,that's the terminology for going
from traditional or tax deferredto raw.
So you pay the tax, it's ataxable event, but now that's
the last time that that accountwill ever be taxed.
So real estate investors loveconversion because that sucks
(46:29):
right now.
The I mean, that conversion youknow might be it's tacking um
onto your taxable income for theyear, but the end result is
tax-free forever gains.
SPEAKER_01 (46:39):
So in this example, that they've had this
traditional Roth earning incomefor a while and all that sort of
stuff.
So is there any kind of set timeframe of like you've got to
convert it in a certain periodof time, or you can convert it
at any time, you're just gonnahave to pay the tax on it?
SPEAKER_02 (46:54):
Yeah, that's a great yeah, that's a great question
because um everybody alwaysassumes, and this is just again,
it's just coming from a badsource, um, that you would have
to make the full conversion.
Let's say that you have amillion dollars in your IRA, you
don't want to pay tax on thatfull amount.
So, what you can do is what'scalled step conversion.
So, step conversion is a waythat you can just pick the
(47:18):
amount of tax that you want topay.
SPEAKER_04 (47:22):
Okay.
SPEAKER_02 (47:23):
And then you can do that on an annual basis, and
then it's just work with yourCPA, work with your accountant,
um, and then you can kind of,and again, let's say like you
have like a solo K, which is atax deferred and a Roth account.
You know, those two accounts canpartner together.
SPEAKER_04 (47:38):
Okay.
SPEAKER_02 (47:39):
So that's just part of the overall strategy.
At the end of the day, we uhwant everything to be Roth.
Right.
Right.
But for today, we still want tosave on taxes, so there's still
like the tax deferredcontributions, you just need to
play with the numbers.
SPEAKER_01 (47:51):
Okay.
So you could you would basicallythe process would be you would
open up a new uh self-directedRoth, let's just say, and you
would start a rollover bit bybit from this from this
traditional year by year orwhatever you wanted to do with
it.
SPEAKER_02 (48:09):
Yeah, so that's yeah, that's how you can
actually, I mean, whether it beyou open up a new Roth IRA or
whether you open up like a uhthe solo 401k because there's a
Roth component inside that.
Um, but yeah, you can makeconversion to either.
SPEAKER_01 (48:24):
Cool.
Okay.
Good to know.
Good to know.
Well, Mikey, we always end witha little fun question because we
get we get people like yourselfwho, you know, you're out aside
of Wisconsin and you don'treally know a lot about
Wisconsin.
SPEAKER_02 (48:35):
So we want people who are desert.
SPEAKER_01 (48:37):
Yes.
Yes.
So we want people to be able todeploy some of that capital here
in the great state, whetherthey're private investing and
and they're gonna lend tosomebody here in the state.
Sometimes they like to just knowa little bit about it.
But you haven't ever been toWisconsin, right?
No, I have not.
So I'm just gonna ask you kindof an off-the-cuff question.
What's your favorite placeyou've been like travel-wise
(48:58):
ever?
You know what?
SPEAKER_02 (49:02):
So I used to think so much back a little bit of a
background story like story.
My grandparents actually retiredto Aruba.
So that was I thought that wasthe coolest place I ever.
So I was like the only kid whowas actually excited just to
visit their grandparents for thesummer.
Um but just recently um we wentto Hawaii.
SPEAKER_04 (49:26):
Okay.
SPEAKER_02 (49:27):
And that was the most beautiful place I've ever
been to.
It was uh Turtle Bay.
SPEAKER_01 (49:32):
Okay, which island is that?
Maui?
SPEAKER_02 (49:33):
Uh Oahu.
SPEAKER_01 (49:35):
Oahu.
Nice, dude.
SPEAKER_02 (49:37):
So that was like every single morning.
Just it was the same hotel, umSaving Sarah Marshall, I think
it was.
SPEAKER_04 (49:45):
Okay.
SPEAKER_02 (49:46):
Yeah.
So it was the same hotel, and itwas just like every morning he
was like, oh, this is unfair.
This is not even real.
SPEAKER_01 (49:53):
Yeah.
Dude, Hawaii's amazing.
I've been to uh a couple of theislands there, Oahu, the Big
Island, and uh Maui.
Okay.
They're all green.
I mean, they all have their theyall have their strengths for
sure.
SPEAKER_02 (50:05):
Yep.
I mean, I I literally saw a dogsurfing.
It was ridiculous.
SPEAKER_01 (50:11):
That's amazing, dude.
I love it.
Well, Mikey, we appreciate youbeing on today, man.
If people want to get in touchwith you and and talk through
any of the strategy stuff, or ifthey've got a private investor
they want to, you know, connectyou with, what's the best way
for them to get in touch withyou?
SPEAKER_02 (50:25):
Yeah, so the best way is probably going to be just
to email me.
Um so M-L I-E L-L-O at I-R A S TC dot com.
SPEAKER_01 (50:37):
Cool.
Awesome, man.
Well, dude, I appreciate youbeing on here.
For those of you guys earlier, Italked about some free giveaways
we're doing.
So we have a Burr for Beginnerscourse.
We used to charge$1,900 for thiscourse.
We are giving it away to ourlisteners for free, you guys.
So this is a huge advantage.
If you are sitting on thesidelines because you've got,
you know, analysis paralysis orhey, I really want to do this
(50:57):
Burr process.
I just don't really know whereto start.
Get the course, guys.
It's free.
Do the work, though.
I will say this.
If you get the course, just doit.
Just do the work.
It's set up to get you into yourfirst or next deal in 45 to 90
days.
So for 45 to 90 days after youstart taking the course, you
should have your first dealunder contract if you follow the
action steps.
Part of that is raising privatemoney in there.
(51:18):
We do go into that in a littlebit.
And this is a great uh Mikey'scompany here is a great uh
avenue to help with some of thatuh private money raising.
So appreciate you being on,Mikey.
And uh appreciate all you guysyou bet, appreciate all you guys
listening in.
If you got some value out ofthis, as we talk about a lot of
episodes, please share thisepisode.
Uh, if you're following us onYouTube, hit the subscribe
(51:38):
button and comment.
That really helps us get up inthe algorithms.
And so we really want to growthe uh listener base and we want
to grow the ratings and reviews.
So we really want to get thisup.
We're in the 60s now in theepisodes.
We want to get those reviews upover 60.
So if you guys could help us outwith that, that would be
amazing.
Appreciate all you guys forlistening, and we'll see you on
the next episode.
What's up, everybody?
Welcome back to another episodeof the Wisconsin Investor.
I'm your host, Corey Raymond.
Today we got a really greatguest here.
I'm excited to get him on uh andintroduce him here in a second.
Before I do, though, like I doon every episode, guys, we're
gonna talk about uh somethingthat we want to highlight or
sponsor.
And so we always talk aboutWisconsin discount properties as
(01:00):
our sponsor.
And I've been talking a littlebit about some giveaways that
we're doing here, some value addthings.
So hang on till the end of theepisode.
I'm gonna talk about uh somefree tools that we have for you
guys to really help make sure ifyou're looking to grow your real
estate portfolio, that we canset you up for success with
that.
So, with that, let's get intoday's episode.
(01:22):
I got Mikey Liello with me.
What's up, Mikey?
SPEAKER_02 (01:26):
What's going on?
How are you doing today?
SPEAKER_01 (01:28):
I'm doing great.
I'm doing great.
So Mikey and I met at a uh TimBratz mastermind event uh not
too long ago.
And I've known uh Edwin fromyour company for quite a while
from Collective Genius as well.
Um but we were chit-chatting alittle bit and having some good
dialogue.
And uh and Mikey, I'll let youintroduce yourself and who
you're with and all that sort ofstuff, and then it'll make sense
(01:50):
of why we have you on here todaya little bit.
SPEAKER_02 (01:53):
Yeah, so uh my name is Mikey Liello with a
specialized trust company.
Uh what we do is we areself-directed retirement account
custodians.
So essentially we teach you howto prevent some taxes, create
some tax-free passive income,and basically secure your legacy
wealth.
SPEAKER_01 (02:11):
And as Mikey just mentioned, tax-free.
Uh if you guys have beenlistening to any episodes with
me, you know that one of myfavorite things in this world is
to legally pay as little amountof federal tax as possible.
And so Mikey's got some coolthings here that we can do that
sometimes can sound kind ofconfusing, maybe overwhelming
for people.
And you know, we'll dive intosome of those different vehicles
(02:32):
and talk about how they can umbe beneficial.
But Mikey, talk first of all,self-directed.
Can for the people that havenever heard of that before,
maybe they've got an IRA or a401k or something like that
right now through an employer,or maybe they have uh had they
got you know legacy from aprevious employer or something
like that.
Talk about the differencebetween that IRA or 401k and
(02:54):
what specialized trusts helpspeople do.
SPEAKER_02 (02:57):
Absolutely.
So this is essentially what theretirement accounts are supposed
to be, in my opinion.
Okay.
Um, not even my opinion, it'sthe IRS's opinion as well.
So essentially, when it comesdown to it, most people think
when you have like a 401k withan employer, like you said, like
an IRA, let's say, you know,with the traditional type of
(03:18):
fiduciary, it's stocks, bonds,mutual funds.
That's the only things that youcan invest in, right?
Not true.
So when it comes down to theretirement accounts themselves,
it comes down to this.
So it's a tax code.
IRC 4975.
So that's like our Bible, right?
Okay.
(03:39):
Now, when it comes to the ruleitself, it actually comes to
this IRA owners can invest intoalternative investments, i.e.
real estate, but IRA custodiansdo not have to offer it as an
investment option.
Uh so here's the fun stuff.
Are they lying to you?
Not necessarily.
(04:00):
They just kind of are justomitting a little bit.
Yeah.
Lying to omission.
Yeah, I mean, here's the thing.
They they want to use yourcapital.
That's what they wanted to be inStock Bonds mutual funds.
Um, because if you were toinvest in 123 Main Street, they
can't take any kind ofcommission off of that.
So here's the only things theIRS says that you cannot invest
(04:24):
in antiques, collectibles, lifeinsurance policies, S
corporations, and alcohol.
Those are your only limitations.
Okay.
Now, when it goes into who youcannot invest in, that's a
little bit more complex.
We'll get into that in a minute.
Okay.
Um, but when it comes to it, andthe whole purpose of actually
(04:45):
retirement account investing isthe fact of retirement accounts
earn tax-free.
So if it's going to be in thestock market and things along
that line, most people don'teven notice that.
Right.
Right.
So the gains are not actuallygoing to be like, oh my God,
it's tax free.
This is amazing.
(05:06):
When it comes to a situationwhere let's say real estate,
yeah, well, those profits aresignificant.
So what's better than thosesignificant gains?
Tax-free.
SPEAKER_01 (05:16):
Tax-free.
SPEAKER_02 (05:18):
Yes.
So what you're able to do is ifyou have all 401ks uh from like
previous employers, TSPs, right?
So for your uh military umaudience.
Okay.
For 403Bs for the teachers andthe state employees, those can
actually be moved and any IRAcan be moved into a
(05:41):
self-directed retirement accountand be directly invested into
real estate.
Okay.
Or alternative investing orprivate lending, buying land,
you know, all of thoseinvestments are allowed to be
invested directly.
And then again, tax-free.
SPEAKER_01 (05:58):
Wonderful.
Wonderful.
So let's talk a little bit aboutum the just self-directing in
general.
You mentioned there's some whoyou can't invest with, right?
Talk a little bit about some ofthe rules with that, because I
think this is a uh clarifyingpoint.
Like you got to know the rules.
You don't want to blow up yourIRAs or your 401ks, right?
And what I mean by that isbasically if you do something
(06:18):
wrong, the IRS could come andsay, eh, nope, this is no longer
a tax-free vehicle, right?
You got to pay the tax and thepenalties and all that stuff.
So it is important to make sureyou understand some of these
things.
But tell us a little bit aboutlike what are some of those kind
of just general rules of thumbwhen you're looking at like,
say, I've got a I've got a sell,I've got something I transferred
over to you guys, you help putit into a self-directed account.
(06:40):
Now I've got an investment Iwant to use it in.
What are the do's and don'tshere of making sure I'm doing
this by the book and and notblowing this thing up?
SPEAKER_02 (06:48):
Yeah.
So we covered what you cannotinvest in, right?
Now, it's important to know whoyou can't invest in.
So basically, here's the rule ofthumb.
Up and down the family tree, youcannot invest in those
individuals.
Okay.
So you cannot invest in your umin your grandparents, in your
(07:10):
parents, in yourself, in yourspouse, in your kids, in your
grandkids.
Okay.
Okay.
Side to side in the family treeis fine though.
Brothers, sisters, aunts,uncles, cousins, completely
okay.
SPEAKER_04 (07:21):
Oh.
SPEAKER_02 (07:22):
Now the key word in that though is investing in.
Okay, so just want to plantthat.
Just everybody just rememberthat keyword.
Yes.
Um so what can you do?
There's essentially threedifferent ways that you can
invest a retirement account.
Okay.
One is outright.
(07:43):
Okay.
One, two, three, main street.
I want to purchase thatproperty.
It cost me a hundred grand.
I have a hundred grand in myaccount.
I purchased that property in thename of the account, all the
profits go back into the accounttax rate.
SPEAKER_00 (07:57):
Okay.
SPEAKER_02 (07:58):
Okay.
Simple.
SPEAKER_00 (08:01):
Yes.
SPEAKER_02 (08:01):
Now, the second is actually going to be leveraging.
So leveraging is completelydifferent.
So you can actually, let's sayyou don't have a hundred grand
in your account, you can borrowin the name of the retirement
account, execute the investment,and then all the profits come
back tax-free.
(08:23):
Now, keyword on that though,there's a very uh specific type
of loan, though.
It has to be a non-recourseloan.
Okay.
Because remember, you're notgoing to be the investor.
The account is.
SPEAKER_00 (08:34):
Right.
SPEAKER_02 (08:35):
So you can't actually personally back it.
SPEAKER_00 (08:37):
Right.
SPEAKER_02 (08:38):
Now the third one, we're going to go back and
circle back to that investing insituation.
So most people have multiplegoals of what they're trying to
accomplish financially.
So especially for families,right?
So you have yourself, you haveyour business, you have the
(08:59):
kids, you have kids' educationgoals, all of these different
things.
That's why we're that's whywe're grinding so much, right?
Right, right.
Retirement accounts and this orself-directed retirement
accounts, it's better to thinkabout them like they're
financial tools.
Okay.
Okay.
Because you have the controlover it and you only have to
(09:21):
listen to what the IRS says.
Okay.
So let's say, for example, youhave um children in private
school.
SPEAKER_04 (09:29):
Okay.
SPEAKER_02 (09:30):
Now, in that situation, okay, now I have to
earn more, get taxed on it, andso I can pay for this education.
Wouldn't it be better if I had afinancial tool that would just
pay for that on its own?
That there is accounts.
It's called a CISA account,Coverdale Education Savings
Account that can be investedinto real estate and actually
(09:51):
will earn tax-free.
SPEAKER_04 (09:52):
Okay.
SPEAKER_02 (09:54):
You also, for the sake of legacy, set up a Roth
IRA for your kids.
And it will, you pay them, andthen they have a Roth IRA.
How amazing would that be if youwere actually, you know, if all
our parents did that?
SPEAKER_01 (10:11):
For sure.
And a Roth IRA, for those thatdon't know, is a tax-free
investment investmentretirement.
SPEAKER_02 (10:19):
Um so here's the difference between just to kind
of plant it.
Tax deferred dollars is greatfor now.
So tax deferred or traditionalaccounts, um, that basically
money put into that account,it's gonna be a tax write-off
for either yourself or for thebusiness.
SPEAKER_04 (10:38):
Okay.
SPEAKER_02 (10:39):
Now it will earn tax free, but then one day you're
gonna have to pay taxes on thegrowth.
Now the Roth is gonna be theopposite.
Roth is, I don't want the taxbreak right now.
It's gonna earn tax free, andthen it's tax-free forever.
Yeah.
So you gotta love that.
And it is down tax-free.
(11:00):
So setting up like a Roth and aCISA account for the kids, it's
very functional, plus it's alsolegacy.
Now when it comes down to thebusiness, of course, we want to
save as much taxes still today,right?
The Roth is great for later on.
But there is an account called aRoth solo 401k.
(11:22):
Okay.
Or just a solo 401k.
And what that does is it allowsyourself to set up a 401k in the
name of your company.
So you're basically gonna be theemployer and the employee.
Okay.
Now that 401k and you have theRoth account set up for the
(11:45):
kids, right?
And then you have the CISAaccount.
So now you're covering yourself,you're covering the business,
and you cover the legacy.
Now remember what I said youcan't invest in each other,
right?
But you can partner.
So if you have all thesedifferent financial tools in
place and you structure thedeals accordingly, which we we
(12:06):
can help you with, um that isthe way that you can actually
multitask with those differentfinancial goals and have them
all be growing tax-free at thesame time.
SPEAKER_00 (12:17):
Interesting.
SPEAKER_02 (12:19):
And you're not wasting the one thing that I
always tell everybody is thatwhen you are actually paying
attention, you're utilizingthese different self-directed
tools that is available foreveryone.
That you are doing somethingthat not many people can't or
know about, but you're savingthe time to get to your
(12:40):
financial goal.
Because time is the only thingyou can't get back.
So if you can prevent the tax,you're gonna reach your goal a
whole lot faster.
And these are tools that you canactually implement.
SPEAKER_01 (12:53):
That's amazing.
So you can take your you're whatyou're saying, I just want to
clarify this and land the planehere a little bit.
You're you can take that RothIRA in your name, you could take
uh solo Roth 401k in your name,or in the company's name, as you
said, and you can partner thoseon a deal, 50-50, let's just
call it.
If they both have 50,000 forthis, 50,000 for that, boom,
(13:16):
they partner now.
Now they earn 50% of each goesback in for the profits, and the
growth that earns tax-free.
Wow, I didn't realize that.
See, I always thought I'm thisis why I have you on here,
Mikey.
I always thought you that's ano-no, that's a prohibited
transaction, is what I thought.
SPEAKER_02 (13:30):
If you invest in each other, got it.
SPEAKER_01 (13:33):
That's the key word.
My Roth can't own it, and thenmy 401k lends capital to it, is
what you're saying.
SPEAKER_02 (13:41):
They have to that's exactly right.
SPEAKER_01 (13:42):
Got it.
They have to be joint venturepartners in a sense, or LLC set
up with those two as 50% ownersin each.
Yeah.
Can it can it be separate?
Could it be 35%, 65% ownership?
Okay.
So it doesn't have to be 50-50.
SPEAKER_02 (13:57):
It just needs to be represented monetarily.
So basically, you can have it towhere um I'll give you a
scenario.
So let's say that you have afamily of four, right?
And kids go to private school,kids want Roth IRAs, they're
smart kids.
Um and then so the parents havea solo case set up.
(14:19):
Okay.
So you can have it where dad andmom, let's say, are 40% of this
deal, right?
So 40 and 40.
And then you have the kids,which are 10 and 10 represented.
SPEAKER_04 (14:34):
Okay.
SPEAKER_02 (14:34):
Right?
To make it easy, what you woulddo is that all those think of
them as entities, not asretirement accounts.
Think of them as like these arebusiness entities.
SPEAKER_04 (14:46):
Okay.
SPEAKER_02 (14:46):
They're all going to be members of one brand new LLC.
And then that LLC makes theinvestment.
SPEAKER_00 (14:55):
Nice.
SPEAKER_02 (14:56):
So you can customize the percentage however you like
to.
There's not, it doesn't have tobe 50-50 in any way.
SPEAKER_01 (15:01):
Okay.
All right, cool.
With a structure like that, howare like I'm just trying to
think through likebookkeeping-wise.
Like that to me sounds like itmight be a bit of a challenge,
right?
Or maybe a pain in the butt.
What are you seeing from clientsdoing some of this stuff?
Like, how are they keepingeverything, you know, by the
books and making sure thedistributions are appropriate
and all that sort of thing?
Is it is it easy?
(15:21):
Is it simpler than I'm thinkingit's going to be?
SPEAKER_02 (15:23):
It's a lot, it it seems like this is the thing I
always tell everybody when itcomes down to self-direction and
then the different strategies,is that it seems like it's very
complicated and difficult.
But really, in nature, uh in itstruest form, it's really very
simple.
It's actually much lessterrifying than actually having
(15:45):
like a traditional type ofaccount because there you have
no control.
SPEAKER_00 (15:49):
Yeah.
SPEAKER_02 (15:50):
Um when it comes down to what we do very well, is
basically it's like kind oflearning a new language, and
you're we're just thetranslators to help basically
kind of navigate you through toget you to where you want to be.
SPEAKER_04 (16:04):
Okay.
SPEAKER_02 (16:05):
Um, and that's the kind of the reason why, you
know, every single time I talkto any client, it's about what
are you trying to accomplish?
Because then you know whichaccounts that you would um you
would want to open up and youknow why.
SPEAKER_04 (16:18):
Right.
SPEAKER_02 (16:19):
So um when it comes down to how to actually
structure it, you know, we'llguide you through that process.
Okay.
As passive custodians, weprocess the investments, we hold
the investments.
Um, but as at specialized, wereally try to be the investors'
custodian.
So we want to basically guideyou through, reverse engineer
(16:41):
what you're trying toaccomplish, and then you know,
teach accordingly.
SPEAKER_01 (16:44):
Okay, cool.
Yeah, because I know there'ssome companies out there, trust
companies, they won't they won'treally get on the phone, they
won't give you any advice, theywon't talk you through how to do
anything.
You're saying you guys arespecialized, you guys will will
hold some hands a little bit, iswhat I'm hearing here, Mikey.
SPEAKER_02 (16:58):
Yeah, there's just not a lot of like educational
tools out there to kind of guidepeople when it comes to
self-direction.
SPEAKER_04 (17:06):
Right.
SPEAKER_02 (17:06):
Not a whole lot of people.
We were just actually at anevent in Dallas, and it's funny
because I was sitting at a roundtable, and I'm leading this
round table, and I know thatthese people have been doing
real estate investing fordecades.
And I'm talking to them aboutself-direction, and it's the
first time they've actually everheard of it.
(17:29):
Which is wow.
When it comes to real estateinvestors, this should be I this
is an ideal tool for you.
SPEAKER_01 (17:36):
For sure.
Well, and that's why I wanted tohave you on here because I feel
like I've known about it becauseof some people locally that were
already doing someself-direction when I got
started at some of the localmeetups and that kind of thing.
They were already talking aboutsome of these things.
But for a lot of peoplelistening to this, they may have
never this might be the firsttime they're like, wait, wait a
minute, what the hell isself-direction versus this and
all this sort of thing?
And that's why I thought, hey,let's introduce that topic to
(17:58):
the audience today after meetingyou, Mikey.
I'm like, hey, this would begreat for us to to to jam out on
a little bit because it is aawesome vehicle and it's a tool.
Like you said, it shouldn't beit shouldn't be every deal
you're doing is in your IRA, butand I mean maybe if that's your
strategy, it's it's an I thinkthat's a tool for yeah, exactly,
because you know it does it doesa couple different things,
(18:20):
right?
SPEAKER_02 (18:20):
So um, like solo 401k.
Solo 401k, one of the reasonswhy it's such an important tool
for real estate investors, it'sa way that you can write off
46,500 for 2025.
Okay.
SPEAKER_01 (18:36):
And that's what from your business, I could take it
from my business, put it intothe solo 401k, I write that off.
SPEAKER_02 (18:43):
Correct.
And then so 2000, if you guysare looking for tax write-offs
for 2025, get started becausethat has to be established for
before the end of the calendaryear.
SPEAKER_04 (18:54):
Okay.
SPEAKER_02 (18:55):
Um now on that same front, so that's your tax
deferment contribution.
Okay, but you're still anemployee of that same um
company, right?
Right.
You're the employer, you're theemployee, you pay yourself.
Yep.
So with that in mind, you canactually contribute up to 23.5
over the age of 50, you can do31 directly to your Roth.
(19:19):
So now you have the best of bothworlds.
So that's kind of like theflexibility when it comes to um
solo K is a great example, justbecause it's kind of like a
financial multi-tool in a lot ofways.
Okay.
Um because with the same, let'ssay that you need some like
household or you just need somecapital for private use, right?
(19:39):
Let's say you have an old 401kfrom an old employer, you move
that and it's called a rollover.
It's not a taxable event, it'snot gonna be something you're
gonna get penalized for.
You just move it from house tohouse.
Now, within that new 401k,though, that you just set up for
yourself, you can borrow up to50,000 unrestricted.
(20:00):
So that 50,000 doesn't followany rules.
It's an unrestricted cash uhloan.
Oh.
And you're gonna pay yourselfback with interest.
SPEAKER_01 (20:09):
Okay.
So now you're writing off.
Is there a rule of like how muchinterest you can charge
yourself?
Because then that that interestis tax deductible, right?
If you're writing it off as anexpense to your 401k?
SPEAKER_02 (20:21):
Well, it it's not gonna be um attached write-off
because there's no tax applied.
So it's tax-free and it doesn'thit your credit, and it's prime
plus two that you're payingyourself back.
SPEAKER_01 (20:32):
Prime plus two.
Okay, but that prime plus twopercentage, I'm saying, is that
gonna be tax deductible, thatinterest that you're paying
yourself back?
SPEAKER_02 (20:40):
It will not be.
No, it won't be.
Yeah.
SPEAKER_01 (20:43):
Okay.
It's just going back in to helpthat investment grow.
Okay.
Got it.
What are some of the reasonspeople don't do a 401k, for
example, or a solo 401k?
Like, is it are there certainrules, restrictions, is there
like what are the lockup rulesbefore you can touch it, like
all that kind of stuff.
Talk a little bit about that.
SPEAKER_02 (21:00):
So 59 and a half is that age that you have to uh you
have to wait until 59 and a halfto actually pay make a
distribution, is the wording,without uh gonna be penalty.
And if it's Roth, then it'sgonna be tax free.
SPEAKER_04 (21:18):
Okay.
SPEAKER_02 (21:19):
Now, with a solo 401k, the only restriction that
you have is that you cannot havefull-time W-2 employees.
So that's your restriction.
Now you and your spouse can beparticipants, okay?
Okay so you can pay yourself,you can pay your spouse, but you
(21:39):
just can't have any other W-2employees.
Got it.
SPEAKER_01 (21:42):
Okay.
So it wouldn't work for menecessarily.
Otherwise, what is the rule?
Don't you have to offer it toeverybody if you offer it if you
have one yourself, then you haveto offer it to everybody, or
there's some some somethingabout that type of rule, right?
SPEAKER_02 (21:55):
Yeah, correct.
So for like your situation, itmight be um more advantageous to
go with like a SEP or a simple.
Um, so for those ones, you'rekind of going into the weeds a
little bit, and anybody who'sactually interested, who has W2
employees, um, just go ahead andget a hold of me.
I'll kind of I'll lay it downfor you.
But with um there's always gonnabe an option.
(22:17):
It just depends on what thesituation is.
Okay.
So saps and simples are yoursecond, third place, basically.
SPEAKER_01 (22:26):
Okay.
Got it.
Okay.
Yeah, I knew there was somereason we we didn't do one of
those over the years, and itmust be because of that W-2
requirement or whatever that is,right?
SPEAKER_02 (22:37):
Yeah, it might be something that we uh probably
want to revisit just to becauseyou have you always have a
possibility when it comes downto these accounts to actually
establish something for the forthe um company itself, but it
just needs to be matched upright.
SPEAKER_01 (22:54):
Cool.
One one thing I'll talk abouthere too, Mikey, is we're still
talking about tax-free.
One of the my favorite thingsthat we've done over the years,
and now it's changed a littlebit because we have employees
and I'm not in the day-to-day asmuch doing these deals, but we
have done deals in ourself-directed HSA account.
Mm-hmm.
And wholesaling a deal for us,it was really it's a really
(23:17):
great way to grow tax-free moneythat you can then use.
I mean, I know I'm gonna usemoney on healthcare, probably,
you know.
I'm not getting what I'm notgetting.
Yeah, right.
Uh so talk a little bit aboutHSAs, self-directed HSAs.
What can you use that money on,right?
So for the people out there whomaybe have never heard of this
(23:38):
HSA thing, how do you get one?
Like those types of things, andthen I can kind of I'll share an
example of the wholesale deal wedid in our HSA.
SPEAKER_02 (23:46):
Going back into kind of how you know, these are just
tools.
Um now going into like the let'stalk about the family plan, kind
of going backwards a little bit.
So with our example, we had theuh the fan the company taken
care of, we had mom and dadtaken care of, kids' legacy, and
then you know, kids' educationis taken care of, right?
(24:09):
Now, to make sure that youbasically are going to be able
to you utilize every tool thatyou can is that you can have,
which most people are aware of,you know, you can have an HSA,
but you can self-direct it.
And so an HSA, it earnstax-free.
So, for one, whatever money youput into the HSA is tax
(24:32):
deductible.
So it's a tax write-off.
So you gotta love that.
Now it will earn tax-free and itwill spend tax-free on any
qualified health cost.
So now you covered all acrossthe board.
Every single thing that youactually are doing real estate
for and what you're trying toafford for your family, it's all
being taken care of.
(24:53):
So I always qualify the CISAaccount and the HSA, those are
your necessary costs of life.
Right?
So health and the kids'education, no matter what, you
probably're gonna have to spendsome money on that eventually.
So now you actually, instead ofactually having to earn more,
getting taxed, and afford thosenecessary costs of life, you
(25:14):
have these tools in place andthey're part of your structure.
SPEAKER_01 (25:17):
Yep.
Yep.
So HSA's how what are there'ssome ri rules about who can get
one, though, isn't there?
Like, don't you have to have acertain type of uh insurance
plan or something like that inorder to be able to qualify to
open one if you don't alreadyhave one?
SPEAKER_02 (25:32):
Most investors actually Or contribute.
Yeah, so most investors reallydo um without them knowing they
qualify for an HSA.
So your only thing is the factthat you have to have a high
deductible health insurance.
Okay.
So that's your only qualifying,you know, the difference between
(25:52):
like W-2 employees that youmight have an employer who
actually you know offers yousome great health insurance, so
therefore you can't have an HSA.
SPEAKER_03 (26:00):
Yeah.
SPEAKER_02 (26:01):
Um but most and entrepreneurs, they're kind of
set up in that high deductibleworld.
And so the HSA is perfectbecause then that'll offset you
know most of your, or if notall, of your health costs.
SPEAKER_01 (26:14):
What do they what do they define as high deductible?
SPEAKER_02 (26:17):
Um, it's gonna go off of basically what the
household is.
So um I think they actually kindof changed it this year.
Um I'll look that up.
I'll get back to you on thatone.
So the high deductible plan.
Let me see here.
SPEAKER_01 (26:33):
Yeah, I knew there was something, but here is
here's one of the things, Mikey.
Correct me if I'm wrong.
If you already have an existingHSA account from say you worked
at a place or you had a highdeductible plan, now you got a
new gig or new your companyswitched insurance plans to a
low deductible.
As long as you still have thataccount, you can still
self-direct that, correct?
SPEAKER_02 (26:52):
Correct.
SPEAKER_01 (26:53):
You just can't contribute to it.
SPEAKER_02 (26:55):
Correct.
That's that is absolutelycorrect.
So with a uh an HSA, so you anyHSA that you had previously can
be transferred.
So that's gonna be another oneof those keywords, right?
Because it's not gonna be ataxable event, it's just gonna
move from house to house.
SPEAKER_00 (27:11):
Yeah.
SPEAKER_02 (27:11):
And now it's able to be invested in what you're
looking for and what you'retrying to accomplish.
SPEAKER_01 (27:17):
Yeah.
So here's an example, guys.
I I used to work for a companypre private previously, uh, and
we had high deductibles, so wecould set up HSA.
So I I was contributing theamount, I think at the time it
was like six or seven grand fora family or something.
So I would contribute that tothe HSA, which again is a tax,
tax-deductible event.
And then um I I found out Icould self-direct this and
(27:39):
actually invest that money inthe HSA.
I thought it was just a savingsaccount, right?
That's what it's labeled at.
So I was like, oh, I don't know.
I'll like I'll just keep themoney in here and then I'll just
spend it down every year, andthen I'll put more in next year
and I'll spend it down.
And uh then I learned aboutinvesting it.
And then I realized for for us,for example, a wholesale deal,
when I was more active in theacquisition side of things, I
(28:01):
would do this at least a coupleof these a year, where I would
lock up a deal, I would give theseller some kind of earnest
money.
And I so when I locked it up,instead of it coming from my LLC
as the buyer, I put down my HSA,FBO, whatever the thing is that
I had to put down on my offer topurchase, I would get some
earnest money, and then I wouldhave the uh custodian send that
(28:24):
earnest money to my seller, andthen I sell this thing, and in
45 days, let's say I made$20,000on this wholesale deal.
I invested$100 and I got back$20,000 tax-free into my HSA
account that I can now use forwhatever I want, health
reasons-wise.
It's got to fit within certainparameters.
SPEAKER_02 (28:44):
Any qualified health cost, which is it's a long list,
just you know.
I mean, it's very expensive.
SPEAKER_01 (28:49):
Right.
Like chiropractors,orthodontists, dentists,
doctors, medicine with it now.
Yeah, that's right.
Any yeah, you can go toWalgreens, you get your
medicines, you're you can getointments, all that kind of
weird stuff you can use your HSAfor.
SPEAKER_02 (29:05):
I remember uh driving to the office during
COVID time, and I was last weeklistening to like terrestrial
radio, and uh the Musinexcommercial came on, and at the
end of it was you can now useyour HSA for Musinex.
And I'm like, Oh really?
Oh wow.
Yeah.
I'm the only person listening tothis and going, Oh, okay.
(29:28):
All right, now I got some morestuff to talk about.
SPEAKER_01 (29:30):
That's right.
That's right.
That was one of my favorite whenI when I realized that I'm like,
wait, I can do, and this istotally legal, there's no issue,
and I like I had this epiphanymoment of like, oh my gosh, I'm
gonna spend money on healthcareno matter what.
I might as well make ittax-free, right?
That was kind of my top process.
So, those of you guys out therelistening, let's say you're, you
know, maybe you're notwholesaling, but maybe you're
flipping and you've got a goodchunk saved up in your uh in
(29:52):
your HSA account.
You can use that money to doyour flip, and then you put the
profits back in.
Now, Mikey, question for you.
A lot of people aren't gonnahave enough capital, let's say,
to do a flip.
Is this one of those scenarioswhere they could partner with an
LLC?
They could have their HSApartner with themselves.
Can they partner with themselveson the deal?
SPEAKER_02 (30:12):
So you can't partner with yourself on that one
because yeah, that's gonna be alittle that's muddy.
So you don't want to kind ofmuddy the waters when it comes
to that one.
So you um like a lot of thetimes when it comes to the
conversation I have with like my101 clients is you know, let's
figure out the overall plan umand just base it off of that.
(30:33):
So just base off of what yourgoals are and then just reverse
engineer from there.
So Like, for example, I I have aclient who kind of similar to
you, uh, just different vehicle.
He has four children in privateschool in j in uh Jacksonville
at twenty thousand dollars apop.
(30:54):
That's a large check, and it'skind of not the most favorite
time of the year for them towrite that tuition check, right?
Um, or it wasn't at the timebecause same thing, you can
actually prioritize some kind ofdeal structure accordingly.
So now he does four deals ayear, wholesales out of those
(31:15):
CISA accounts.
So therefore, instead ofactually, and what he did, and
you know, similar to like withyour HSA, he's not earning more
to afford his necessary cost oflife, right?
He is actually structuring thesedeals to make sure his tax
liability is not gonna go up sohe can pay for things that he
(31:36):
wants to pay for.
Right.
So now you're eliminating thetax problem at the same time
that you're actuallyaccomplishing your goals.
SPEAKER_01 (31:44):
For sure.
Well, and you're keepingyourself in a lower bracket,
right?
So not only are you not payingtax on income, you're keeping
all of your other income in alower bracket.
Exactly.
Because you're not paying that,yeah.
That makes a lot of sense.
SPEAKER_02 (31:56):
You're not sacrificing anything.
SPEAKER_01 (31:58):
No, not at all.
Exactly.
SPEAKER_02 (32:00):
So life's good.
SPEAKER_01 (32:02):
So talk, let's talk through a flip scenario because
I have a lot of flippers thatlisten to this.
How could a flipper structuresomething like an HSA and their
CISA and some of these things?
Like, how would they do that?
Let's say they're, you know,they're just starting out, they
just opened some of theseaccounts in the last couple
years, they don't have a lot ofuh capital built up in it per
se.
What's what's kind of a creativeway they could maybe utilize a
(32:23):
smaller amount of capital insome of these accounts besides
wholesaling?
Again, I know the wholesale wentpretty easy.
Yeah.
Talk about like a flip.
How could we structure a flip?
So maybe a couple differentways.
SPEAKER_02 (32:35):
Yeah, so a couple different ways.
So let's say that you have likeold retirement accounts from
previous employer, right?
So uh mom and dad, you know,they both had previous lives,
they you know had different uhjobs.
So that's the one thing that Ithink a lot of people don't
realize is the fact that theyhave complete access to those
(32:56):
accounts.
It's still your money, right?
It's just a matter of you thinkand everybody's told you that
it's locked up where it is andit's monopoly money.
Who cares about it, right?
So when it comes to actuallymoving it, not gonna be a
taxable event.
I don't care what your financialadvisor told you, that you just
they just said they just don'tthey omit when it comes down to
(33:18):
oh, if you take money out,you're gonna get taxed and
penalized.
True.
If you actually just took adistribution, that's right, but
you're not doing that, you'removing it.
Okay, so now you have untappedcapital that's now funding your
solo 401k, for example, and youwant to open up accounts for the
kids.
So you can partner all of thosedifferent accounts, including
(33:40):
the HSA, partner them alltogether.
So now one account, let's say,didn't didn't have enough
capital, but combined, theycan't.
So that's a way that you canactually deal structure
something.
So let's go back to thepartnering.
Now, let's just say that mom anddad are just trying to go with
using their they want to takecare of their um 401k, they want
(34:03):
to make that grow.
They basically they've uhthey're trying to catch up for
time, right?
Now the solo 401k is uniqueagain because it's the only
account that you can actuallyborrow in the name of and if you
avoid what's called a UBIT tax.
(34:24):
So unrelated business incometax.
So deal structure number two isleverage.
So you don't want to pay anymore taxes personally, you want
to have this fix and flipbecause you know it's gonna be
um tax-free forever because it'sgonna be in your Roth account.
All those scenarios,everything's great, but you
don't have the capital inside ofit.
You can leverage and avoid thatU bit tax.
(34:47):
So U-bit tax basically is kindof one of those ones where um
everything seems great in theworld, and then all of a sudden
the government had another idea.
Um, but this is the way that youcan do that.
So that's that's why that solo Kis also very important because
it does avoid that.
And most flippers will love thatsituation.
(35:07):
Okay.
unknown (35:07):
Okay.
SPEAKER_01 (35:09):
Talk about U-Bit tax for a second, Mike.
You can go on to the otherpoint, but uh, we can circle
back to U-Bit tax.
But I do want to talk about thatbecause that's always kind of
been a uh cloudy thing in mybrain of understanding U-Bit.
Okay.
SPEAKER_02 (35:20):
Um yeah, it's one of those ones where the government
doesn't want you to operate abusiness inside of your
retirement account because it'stax-free, right?
Okay.
So an IRA can be subject to UBITtax.
Okay.
Okay.
401k is not really.
Now, when does it kick in?
We don't know.
Like no one actually there's nota set number of deals that you
(35:43):
can have like in an IRA beforeUBIT tax kicks in.
So it's it's so cloudy.
It's just a matter of wheneverit pops up.
That's why, okay.
If you have a 401k, you'reyou're happy.
Um, inside the IRA, you justwant to kind of it could be
four, it could be five.
It's there's no set rule in thetax code to kind of like this is
(36:04):
what it does.
SPEAKER_01 (36:04):
It's just when they're somebody's doing a deal
a year, they're gonna be fine.
Right?
Yeah, is there a certain dollaramount like gain on their
investment that triggers it, oris it there's really not.
SPEAKER_02 (36:15):
It's it's so and it's such an interesting rule
because it's so vague.
Um and then so when it kicks in,it sucks.
Uh you know, it's 37%.
Um so it's a matter of if youcan apply uh if you qualify for
the solo 401k, set the solo401k.
(36:36):
Okay.
That's that's your your bestfriend right there.
SPEAKER_01 (36:38):
Okay.
And if you want more info onUBit, maybe go to like ChatGPT
or something, research it up alittle bit.
SPEAKER_02 (36:45):
Yeah, you want to do that.
I mean, most people if you'regonna be in that situation,
you're flirting with that idea,talk it to uh your CPA tax
attorney just to kind of gothrough the details on that.
Um they might have a little bitmore insight, but it's just it's
such a random rule that thatjust kicks in whenever.
And it's basically kind of theidea behind it is that they just
(37:09):
don't want you to operate abusiness.
SPEAKER_01 (37:10):
Okay.
So one one thought I had as youwere talking, Mikey, before
about how do we how do westructure a flip or even
rentals, right?
You could do rental propertiesin these and create some passive
uh ongoing income coming intoyour into your retirement
accounts.
Uh let's say here's an example.
I've got a buddy, he's got agood amount of capital, right?
I've got a smaller amount ofcapital in my IRA or my 401k or
(37:35):
my HSA or whatever my CISA,whatever I want to self-direct,
right?
We decide we're gonna part we'regonna create an LLC with my
retirement, CISA, whateveraccount, and there.
So maybe it's 75, 25% ownership,something like that, right?
Flip side, they also have someretirement accounts over here
that are smaller amounts, and Ihave a bigger amount.
(37:56):
We could create a different LLCfor that, and we just trade
deals for say, okay, this dealwe're gonna do it under this LC,
this deal we're gonna do underthis LC.
And it's a way for us both tomaybe grow our retirement
accounts together and try tosplit that up.
And that's totally legal, noissues with that.
SPEAKER_02 (38:12):
Yeah, as long as you're not investing in
yourself.
That's that's the key word inthat.
So with that scenario, you justdon't want to be lending to your
own deal, like for example,right?
SPEAKER_01 (38:23):
So they would have to bring the capital for that
deal outside of anything that myretirement account had, or that
we we weren't leveraged.
But again, the leverage piece iswhere it gets tricky because
you've got a a lot of these aregonna be personal guarantees
that these lenders are gonnawant, right?
So it's gotta be a non-personalguarantee.
SPEAKER_02 (38:40):
Non-recourse.
Yeah, correct.
So here's here's a kind ofscenario for the here's your fix
for that.
Okay.
Um, a lot of people, I usuallysay it's roughly around 80% of
the room that has had has likeretirement accounts from
previous employers just around,right?
Okay.
That most people don't even knowthat they can access.
(39:03):
Um, it's monopoly money, right?
It's just not even a real thing.
Now, what they don't knowthough, is that all of you real
estate investors, you can borrowother people's retirement money.
And you can give them an actualreturn and they're gonna love
you for it.
And everybody wins.
(39:24):
Yeah.
Because it used to be a lazyasset and now it's not.
And so when it comes down tomaking sure that you can take
full advantage, um what it wasdoing before was nothing.
SPEAKER_03 (39:38):
Right.
SPEAKER_02 (39:39):
Now you're have you're having a new conversation
and you're saying, like, hey,you know, do you have old
retirement money?
Well, I have this deal, I'llgive you nine percent, I'll give
you whatever the amount that youdecide, because you get to
decide it.
And they're gonna be like, Oh mygod, that's way better than
(39:59):
whatever I've done before.
And then now you started aprivate money network that is
secured by a promissory note andyou made up the terms, yeah, and
you have a network that's nevergonna, you know, the next time
that there's a deal, would youthink they're gonna say no?
No, just like no, let's keep iton, let's double up, let's you
know, let's compound.
(40:21):
So for you guys who are learningum trying to raise private
money, then we should talkbecause you know, you start
those conversations.
We have plenty of clients whoare like this.
Is that you know, you start thatconversation and we'll talk them
through because it's gonna bescary and weird for them at
first, yeah, right?
(40:41):
Because who knows anything aboutthis stuff.
SPEAKER_04 (40:43):
For sure.
SPEAKER_02 (40:44):
But we do.
And so we'll guide them throughto give them all, you know, make
sure that they feel securebecause that's all this is tax
code.
Right?
SPEAKER_04 (40:54):
Yep.
SPEAKER_02 (40:55):
So when it comes down to that situation, you're
just basically telling them thisis what it should be like.
It just wasn't that way before.
Yeah.
But now it can be.
SPEAKER_01 (41:08):
So what Mikey's basically saying, guys, is such
a good point out there.
So if you're sitting here andyou're like, I I don't even want
to think about retirement rightnow.
I'm just getting started.
I want to get my first coupledeals, whatever the case is.
And it's a private money, right?
What Mikey's talking about isthere is a massive amount of
untapped money sitting inretirement accounts, not even
deployed, right?
Mikey, isn't it like somethingin the trillions?
(41:28):
Yeah.
SPEAKER_02 (41:29):
Yeah, um, I think it was 24 trillion, I think, last
time I checked.
SPEAKER_01 (41:33):
Literally trillions of dollars sitting in people's
retirement accounts, not evenworking right now.
It's just sitting there.
People kind of forgot aboutthat.
They even have it.
So Mike is saying, go go talk tothem.
They don't they don't want toput their own cash into it, but
they've got this monopoly moneysitting there that they, you
know, they're not reallyemotionally attached to.
It's kind of like, ah, it's justsitting here anyway, right?
SPEAKER_02 (41:51):
Yeah, it's good.
It's literally they're notthinking about it in any way
possible, right?
It's just something.
Imagine that you had, and thisis what comes up.
You know, you'll have a lot ofpeople like, uh, it's not even
that much.
It's like a hundred grand.
Okay.
If that was cash, you wouldn'tbe talking about it like that.
(42:13):
So true.
So, and so all you real estateinvestors, when you actually
think about that type of thing,or you hear that, those that
should make some like your eyesjust get real wide and you guys
get real happy because that's ahundred grand that you can use
for capital.
SPEAKER_01 (42:30):
Absolutely.
Yeah.
And you know, let's say thatperson has like their retirement
account sitting in Vanguard orFidelity or something, and
they're like, Well, I can't Ican't do it because it's in this
Vanguard Fidelity.
That's why you got somebody likeMikey here.
What Mikey's talking about isyou guys you connect with him,
we'll get his contact info andeverything in the show notes
here for you.
You contact Mikey, you say, Hey,Mikey, I got this client, they
(42:50):
want to move to self-directed,but they don't want to pay the
penalties.
What he's talking about earlieris a rollover, not a
distribution.
So Mikey will help them makesure that they do the rollover
properly.
So they're rolling it into asimilar account.
It's just instead of sitting intheir Roth IRA of Fidelity, it
is now sitting in aself-directed account, a
specialized.
And now they can now they can goand deploy that capital however
(43:13):
they want, as long as it's inthat, you know, not in the
alcohol business or whatever,you know, those those prohibited
ones we talked about earlier.
Don't be buying booze with it,right?
Uh, but they could do it in yourreal estate deal.
And they could be a privateinvestor basically lending to
you.
They're gonna be secured by thereal estate, by a promissory
note.
Their IRA is gonna be insured,it'll be insured on the property
(43:34):
and all those sort of things.
Make sure you do all thatcorrectly.
But that it's a much safervehicle for them.
Uh plus they're getting cap,they're getting a return on
their money and it's tax-free.
SPEAKER_02 (43:45):
Yeah.
It's amazing how it's just oneof those situations where you're
just taking control.
That's what you're doing.
And you're utilizing what youcan utilize.
Just just because it's unknowndoes not mean that it's not
allowed.
Yeah, that's you just have tohave those conversations.
Um, of course, you need to makesure to to listen to the rules,
(44:06):
but yeah, we'll we'll teach youthose.
Um, but when it comes down towhat the end result is, it's
tax-free forever wealth.
SPEAKER_01 (44:14):
Yeah.
Yeah, which is amazing.
So nine, your nine percent yourRoth.
I mean, I don't know what theconversion is if you had to pay
tax on that, but it's muchbetter than nine percent if you
look at comparatively speakingto a taxed nine percent return.
SPEAKER_02 (44:29):
So and the Roth is is always going to be something
that's gonna be king.
I mean, it's like it's basicallypaying tax on the seed, not the
crop.
SPEAKER_01 (44:37):
Yeah, that's a great analogy, by the way.
Last question I have for you,Mikey.
This is one I have uh stole thatone from Edwin.
I like that one.
That one's good.
Uh I I have a family member whohas an account invested in a
hard money lending fund.
So similarly, they're just notthe one they're getting a return
on their money.
They're just not uh the onedirecting which investments.
(44:57):
They just put it in the fund andthen that company goes and lends
that money out on their behalf,so to speak.
But one of their accounts is atraditional IRA.
And so they're they're wonderinghow can they get that into a
Roth?
Can you talk a little bit aboutwhat that process is?
And and I I believe there'ssomething called the backdoor
Roth.
Can you talk a little bit aboutthat?
SPEAKER_02 (45:17):
Yeah, so um backdoor Roths, or essentially, this is
one of the most prevalent thingsthat um I've heard so many times
throughout the years, is thatyou know, oh, I can't I can't, I
make too much, I can't have aRoth IRA.
No, that's not what it is.
When it comes down toestablishing a Roth IRA, it is
(45:42):
very much a situation where youcan establish it, but you might
not be able to directlycontribute to it.
Okay.
Okay.
So when that that happens, whatyou do is you establish a
traditional IRA, you contributeto the traditional account, and
then you can actually convertit.
(46:04):
Okay.
So conversion is the differentthat's what the rule of thumb
is, or not the rule of thumb,that's the terminology for going
from traditional or tax deferredto raw.
So you pay the tax, it's ataxable event, but now that's
the last time that that accountwill ever be taxed.
So real estate investors loveconversion because that sucks
(46:29):
right now.
The I mean, that conversion youknow might be it's tacking um
onto your taxable income for theyear, but the end result is
tax-free forever gains.
SPEAKER_01 (46:39):
So in this example, that they've had this
traditional Roth earning incomefor a while and all that sort of
stuff.
So is there any kind of set timeframe of like you've got to
convert it in a certain periodof time, or you can convert it
at any time, you're just gonnahave to pay the tax on it?
SPEAKER_02 (46:54):
Yeah, that's a great yeah, that's a great question
because um everybody alwaysassumes, and this is just again,
it's just coming from a badsource, um, that you would have
to make the full conversion.
Let's say that you have amillion dollars in your IRA, you
don't want to pay tax on thatfull amount.
So, what you can do is what'scalled step conversion.
So, step conversion is a waythat you can just pick the
(47:18):
amount of tax that you want topay.
SPEAKER_04 (47:22):
Okay.
SPEAKER_02 (47:23):
And then you can do that on an annual basis, and
then it's just work with yourCPA, work with your accountant,
um, and then you can kind of,and again, let's say like you
have like a solo K, which is atax deferred and a Roth account.
You know, those two accounts canpartner together.
SPEAKER_04 (47:38):
Okay.
SPEAKER_02 (47:39):
So that's just part of the overall strategy.
At the end of the day, we uhwant everything to be Roth.
Right.
Right.
But for today, we still want tosave on taxes, so there's still
like the tax deferredcontributions, you just need to
play with the numbers.
SPEAKER_01 (47:51):
Okay.
So you could you would basicallythe process would be you would
open up a new uh self-directedRoth, let's just say, and you
would start a rollover bit bybit from this from this
traditional year by year orwhatever you wanted to do with
it.
SPEAKER_02 (48:09):
Yeah, so that's yeah, that's how you can
actually, I mean, whether it beyou open up a new Roth IRA or
whether you open up like a uhthe solo 401k because there's a
Roth component inside that.
Um, but yeah, you can makeconversion to either.
SPEAKER_01 (48:24):
Cool.
Okay.
Good to know.
Good to know.
Well, Mikey, we always end witha little fun question because we
get we get people like yourselfwho, you know, you're out aside
of Wisconsin and you don'treally know a lot about
Wisconsin.
SPEAKER_02 (48:35):
So we want people who are desert.
SPEAKER_01 (48:37):
Yes.
Yes.
So we want people to be able todeploy some of that capital here
in the great state, whetherthey're private investing and
and they're gonna lend tosomebody here in the state.
Sometimes they like to just knowa little bit about it.
But you haven't ever been toWisconsin, right?
No, I have not.
So I'm just gonna ask you kindof an off-the-cuff question.
What's your favorite placeyou've been like travel-wise
(48:58):
ever?
You know what?
SPEAKER_02 (49:02):
So I used to think so much back a little bit of a
background story like story.
My grandparents actually retiredto Aruba.
So that was I thought that wasthe coolest place I ever.
So I was like the only kid whowas actually excited just to
visit their grandparents for thesummer.
Um but just recently um we wentto Hawaii.
SPEAKER_04 (49:26):
Okay.
SPEAKER_02 (49:27):
And that was the most beautiful place I've ever
been to.
It was uh Turtle Bay.
SPEAKER_01 (49:32):
Okay, which island is that?
Maui?
SPEAKER_02 (49:33):
Uh Oahu.
SPEAKER_01 (49:35):
Oahu.
Nice, dude.
SPEAKER_02 (49:37):
So that was like every single morning.
Just it was the same hotel, umSaving Sarah Marshall, I think
it was.
SPEAKER_04 (49:45):
Okay.
SPEAKER_02 (49:46):
Yeah.
So it was the same hotel, and itwas just like every morning he
was like, oh, this is unfair.
This is not even real.
SPEAKER_01 (49:53):
Yeah.
Dude, Hawaii's amazing.
I've been to uh a couple of theislands there, Oahu, the Big
Island, and uh Maui.
Okay.
They're all green.
I mean, they all have their theyall have their strengths for
sure.
SPEAKER_02 (50:05):
Yep.
I mean, I I literally saw a dogsurfing.
It was ridiculous.
SPEAKER_01 (50:11):
That's amazing, dude.
I love it.
Well, Mikey, we appreciate youbeing on today, man.
If people want to get in touchwith you and and talk through
any of the strategy stuff, or ifthey've got a private investor
they want to, you know, connectyou with, what's the best way
for them to get in touch withyou?
SPEAKER_02 (50:25):
Yeah, so the best way is probably going to be just
to email me.
Um so M-L I-E L-L-O at I-R A S TC dot com.
SPEAKER_01 (50:37):
Cool.
Awesome, man.
Well, dude, I appreciate youbeing on here.
For those of you guys earlier, Italked about some free giveaways
we're doing.
So we have a Burr for Beginnerscourse.
We used to charge$1,900 for thiscourse.
We are giving it away to ourlisteners for free, you guys.
So this is a huge advantage.
If you are sitting on thesidelines because you've got,
you know, analysis paralysis orhey, I really want to do this
(50:57):
Burr process.
I just don't really know whereto start.
Get the course, guys.
It's free.
Do the work, though.
I will say this.
If you get the course, just doit.
Just do the work.
It's set up to get you into yourfirst or next deal in 45 to 90
days.
So for 45 to 90 days after youstart taking the course, you
should have your first dealunder contract if you follow the
action steps.
Part of that is raising privatemoney in there.
(51:18):
We do go into that in a littlebit.
And this is a great uh Mikey'scompany here is a great uh
avenue to help with some of thatuh private money raising.
So appreciate you being on,Mikey.
And uh appreciate all you guysyou bet, appreciate all you guys
listening in.
If you got some value out ofthis, as we talk about a lot of
episodes, please share thisepisode.
Uh, if you're following us onYouTube, hit the subscribe
(51:38):
button and comment.
That really helps us get up inthe algorithms.
And so we really want to growthe uh listener base and we want
to grow the ratings and reviews.
So we really want to get thisup.
We're in the 60s now in theepisodes.
We want to get those reviews upover 60.
So if you guys could help us outwith that, that would be
amazing.
Appreciate all you guys forlistening, and we'll see you on
the next episode.
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