Episode 35: Exploring Tax Benefits in Real Estate Investing with an accountant

Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
I think you had touchspot.
It too is like contracts too.
It's like a deal is not a dealuntil you get to the closing
table.

Speaker 2 (00:05):
Yeah.

Speaker 1 (00:05):
Because anything is off.
You know it's like, it's likethey.
It's a different mindset.
I think here in Florida, wherecontracts and deals are a little
more fluid.

Speaker 3 (00:19):
Yeah, we're over there.

Speaker 1 (00:22):
It's like it's like you know you, you know you have
like not to get to.
They get the George Lord's likereally you know making sure
they got their cover and allthat, yeah, as opposed

Speaker 3 (00:31):
to other Other.

Speaker 4 (00:36):
I don't know who you're insulting.

Speaker 3 (00:37):
Maybe both Well done.

Speaker 5 (00:40):
He's managed to insult you.
Call it excites, I'm out.

Speaker 4 (00:43):
So listen, the Jews are too terrible.
No one can be offended.

Speaker 2 (01:00):
All right, episode 30,.
This has to be 35.
35.
I got it right.
There we go 35.
So we got a guest today.
First, let me introduce you.
What should I do first?
Introduce him.
What's the what's like thecorrect way to do it?
Introduce him first orintroduce ourselves first,
because he doesn't really knowwho you guys are.

Speaker 4 (01:16):
You already ruined it , I already ruined it, so I
would just go ahead andintroduce the guest, all right.
So fix it in post no for now.

Speaker 2 (01:22):
So Richard Richard Barbara, richard Barbara
attorney.
He is a real estate attorneyand he's a.
Are you a chairman, yet A freckor vice chairman?
Vice chairman appointed byDesantis, to our great governor,
to to the Florida real estatecommission, which I don't know.
It's a big deal in our world.

(01:42):
I don't know.
In the CPA, what's your?
What's the version of freck Foryou guys?

Speaker 1 (01:46):
I mean, I guess, the Florida Institute of Certified
Public Accountants.

Speaker 4 (01:49):
Right For you guys?
I guess no.
But who's your license on thephone?
Who could take your license?

Speaker 1 (01:54):
Oh, it's going to be the, the board of accountancy.
You know the department.

Speaker 3 (01:56):
Yeah, that's right, he's a that's who you are.

Speaker 4 (01:58):
Yeah, that's who you are.
That's who you are.
Yeah, yeah, yeah.

Speaker 2 (02:01):
He's.

Speaker 4 (02:01):
I mean not that guy, but something like it.

Speaker 2 (02:03):
Yeah, yeah, he's also never been wrong, which is
really really something that I'msure you never met.
Anybody's never been wrongbefore, that's an interesting,
it's just infrequent.
Josh Cadillac, published author.
I've known Richard almostalmost 18 years, cadillac
published author and thesmartest guy I know.
So he teaches, he teaches forthe National Association of

(02:25):
Realtors all across the countryand stuff.
So and tell us a little bitabout yourself.
So I know you're.
All I know is I'm purpose.
By the way, I'm trying to like,I want the introduction to
happen here.
I want to.
I want you know, just to get toknow you here instead of on the
phone or anything like that.

Speaker 1 (02:39):
So so a little bit about yourself.
So I'm Steve Cologne.
I'm a CPA here in the state ofFlorida for the better part of
two decades Now.
I've been a CPA for about threedecades.
I started my career in New Yorkwith the international firm of
a key you had to get, you had tore get your license over here.
I did All right.
Yeah, it was a pin and a yes.

Speaker 2 (02:57):
Yeah, yeah, yeah, yeah.
You have to do it in Spanishover here, or something, right?

Speaker 1 (03:01):
Something like that.
Yeah, so I'm on the West Coast,I'm in Sarasota, so I got two
office locations over there.
You know basically deal with alot of real estate agents, a lot
of real estate investors.
You know it's basically highnet worth individuals, A lot of
small businesses.
Would you say your specialty isreal estate.
Probably, I'd say at least 50%of my practice probably is

(03:22):
involved with the real estate.
I mean, you know, typicallythat's where the wealth is.
You know, most millionaires aremade through real estate.

Speaker 2 (03:28):
Is that a fact?
Yeah, I heard it was stocks.

Speaker 1 (03:31):
No, it's through real estate.

Speaker 2 (03:32):
Actually, every time I look it up it's a different.
It gives you like a differentstat, I don't know.
So it's real estate, it's realestate.

Speaker 1 (03:38):
It's definitely real estate and that's what I see in
my practice, because I don't seea lot of people that are W2H
owners and then, you know, overtime you develop these like
massive investment portfolios,unless you're like you know,
you're playing in MLB in WallStreet.
Well, those guys, usually thoseare the winners.

Speaker 2 (03:53):
Right, but what percentage of those guys keep
their wealth?
You know those guys are heavyearners in their late 20s, early
30s, heavy consumers, you know.

Speaker 1 (04:05):
Yeah.

Speaker 2 (04:05):
Because I have that.
I have that.
It's definitely an argument.
I like to argue, so I findwhenever I find an argument.

Speaker 3 (04:11):
I just get it and I fucking run with it.

Speaker 2 (04:13):
So there's the argument of a lot of these dads
that because you know, since myson Russell's, they're like, oh,
but there's no professionaloutlet for it.
I'm like that's actually what Ilike about it, because you
don't spend your whole fuckingentire life, you know, thinking,
all right, I'm going to make itto the MLB, I'm going to make
it to the NFL, you're, you'relike, all right, let's see how
many people I can meet, how manyconnections you know best.
Education, best most.

(04:34):
And education, richard and Iargue about that all the time,
not that I wave it off, but Ithink it's more who you're
surrounding yourself by.
Yeah, right, if you go to theseIvy League schools and
everything you're meeting thenext you know X, y and Z and
stuff like that.
So, so yeah, it's, it's.
I don't know we could go ondown that education rabbit hole
for, for, for a while.

Speaker 1 (04:55):
I mean, I think it's good you know if you get, if you
can fund your college throughthe sport.
Yeah, and a lot of these guys Iguess they get into like MMA
and stuff like that too, right.

Speaker 2 (05:02):
But but here's the thing.
So then a lot of these footballguys, basketball guys, etc.
They make, you know you know,millions of dollars.
They don't.
You know it comes easy, usuallygoes easy, right, they don't.
They don't know how to manageit.
I tell you I didn't, eventhough I got into business
really early.
I don't think I became abusinessman until I got my ass
kicked Right and and and had torebuild it again and and really,

(05:26):
oh, I get it.
I never forget the first time Iheard the word overhead Right,
it was from some some real cheap, some client that I had that
was doing really, really well,but he was a cheap bastard and
he asked me like what's youroverhead Interesting?

Speaker 4 (05:40):
You're like I don't know, what does that mean?

Speaker 2 (05:43):
I'm learning as I go.
I mean, I'm just, you know,hiring is what I need, as many
you know it wasn't really likeI'm learning, learning as you go
.
You know what I mean.
So so that's where we're.
Definitely, you know, somelevel of education would have
helped me, for sure you know.
But but yeah, back to thebaseball guys.
You know.
So I wonder, you know how thatworks.
My wife, no matter how manytimes I tell her we're on a

(06:06):
podcast, um, so I wonder howmany of those guys actually keep
their, their, their, theirwealth?
I wonder if there's a, you'resure there's a stat out there.
There has to be a stat.
It kind of like usually knowsevery stat.
So I was looking at him when Iwas a.

Speaker 1 (06:19):
I don't know why we wonder there's a stat.
I think there's something aboutthat.
Guys like an NFL, like acertain percentage of them by
this time, like I think withinfive years, a lot of them go
like go broke.
Yeah, because they just don't.
You know they're funding all ofthese purchases, getting.
You know giving loans to alltheir friends.
You know that's like one of thebiggest things you know
investing like in all these.

(06:40):
Everybody brings them like abusiness opportunity.

Speaker 5 (06:41):
It's like they are horrendous investing in this
swap plan here and then you know, just throwing money out and
anybody that's seen ballersknows yeah, yeah, yeah, that's,
but I know there there was astaggering stat about that I.

Speaker 1 (06:51):
I don't know the exact number, but there yeah.

Speaker 5 (06:54):
The larger.
I think Jesus's exampleactually is a really good one,
because this is how anybodylearns about business, because
if you go to college, they'renot going to teach you about how
money works and how businessworks.
I mean, I always come back tothat scene from the movie Back
to School with Rodney Dain whenhe goes into the business class
and the guy is talking about howthey're going to make widgets

(07:14):
and he's like he's exactly goingto work, you know who's going
to pick up the trash.
You know, like you got to take a, you got to pay off the the.

Speaker 3 (07:22):
You know and so we're going to pay off, right yeah.

Speaker 5 (07:24):
There's all of this, this, these moving pieces, and
so the education system entirelyand adequately prepares people
to handle money and to know howmoney works.
I mean, unless you're takingspecific degrees in one of those
fields, you're just notprepared.
Yeah, and so now these kidscome out and they immediately
make millions with a very shortlife cycle, I mean.
I think what it is three yearsin the NFL is is three and a

(07:46):
half years is the average.

Speaker 2 (07:47):
The average, something like that, yeah.

Speaker 5 (07:48):
So I mean, by the time you figure out what
overhead is, you're out of a job.
Yeah, and so there's reallyjust it's inadequate preparation
, based upon what we in societyhave largely dedicated to
mainstream education, which is,hey, take my kids and make them
ready for the real world.
So, then the argument.

Speaker 4 (08:08):
I think it's.
There's a.
There's another factor, thoughthe thing with pro athletes or
or any, any individual who's ina profession where they make
insane money overnight.
It's that immediate change,sure.

Speaker 2 (08:22):
So if like for most, Well, there's no other than
athletes, though.
Right For yeah actors.

Speaker 4 (08:27):
Okay, yeah, one day you know, yeah, all right.
So so you know, I think whathappens is for most of us, you
start making more moneygradually.
So just from a financemanagement standpoint, you know,
it's like you.
Maybe your next car is a littlenicer than your prior car and
your next house is a littlenicer in your prior house.
But in professional athletesspecifically, there's a lot of

(08:52):
people that go from absolute,like poverty, right to extreme,
like the epitome of wealth.
Yeah, you know, overnight.

Speaker 2 (09:00):
That has to be a major shock to me.

Speaker 4 (09:01):
I don't care what you know, I mean it's just very
difficult, you know you couldhave gone to, like everyone's
you know, the best accountancyand finance management classes
in the world, and just thatshock is going to make it harder
yeah.

Speaker 2 (09:13):
That one girl shows up, says she wants to go to the
Maldives and all of a suddenyou're flying yeah.

Speaker 4 (09:16):
And no, and you can, and you can actually go to the
Maldives.
I mean I can't.
I can't.
How many of us raise your hand?
You want to go to the Maldives?
Fuck.

Speaker 2 (09:22):
First we got to find out where it is.
I got to find out where it isand then you call it.

Speaker 4 (09:25):
But if you have that kind of money, though you don't
have to know where it is.

Speaker 3 (09:27):
That's right, you know you're going to pay the guy
that knows where it is.

Speaker 1 (09:30):
So I mean, let's face it, even going to high school,
there's no financial literacy atall.
They don't teach you how tobudget.
They don't teach you that youhave to pay.
You know, put your this livewithin your means, how to save,
how to invest.
Man, there is such a greatTwitter exchange on that.

Speaker 4 (09:47):
I know it's not Twitter anymore, but it's like
Joe Robbie Stadium Okay.

Speaker 5 (09:50):
It's always going to be Twitter.

Speaker 4 (09:52):
So you know, it's like the guy.
The first tweet is you know, Iwish?
And it's always around tax timethat it comes out, you know?
And it says, oh, I wish, youknow, I wish high school would
have taught me how to do mytaxes.
And then the reply is first ofall, the mitochondria is the
powerhouse of the cell.
Ha, ha, ha, ha, ha ha.
Exactly.

Speaker 3 (10:12):
But listen.

Speaker 4 (10:13):
I'll tell you what.
In law school they don't teachyou how to be a lawyer either.
I mean, that's reality.
You know we joke about that.
You get out of school andsomebody tells you to like, hey,
can you set this for hearing?
And you're like what, what doyou mean?
Set this for hearing?
So you know, there's like thestaff.

Speaker 2 (10:27):
Is that the same as CPA or?

Speaker 1 (10:29):
It was the worst experience ever and I started
editing True story and thisconference table.
It rebinds because I remembergoing out to a client it was
freezing cold going in theresitting down waiting for the
partner and the manager to comein, and then they're like, okay,
grab all the files.
And then back then we had theRedwells, everything was okay.
We just were barely having likelaptops, no cell phones, there

(10:49):
was no Google, there's nonothing.
And basically they're like oh,here's the work papers from the
year prior.
It's like you're all set,you're good.
He introduced me to everybody.
Here's the controller, this isthe lady in the air, this is
everybody.
He said, okay, you're good, youcan eat anything Leaves.
And it was like literally liketrying to put like a like a
50,000 jigsaw piece puzzletogether with no instructions,
and I'm like looking through andlike and just feeling like a

(11:11):
complete idiot.
So they don't put same thing,they don't prepare you for no, I
mean, yeah, it's like I had aconversation about this with a
colleague of mine.
It's like 85% of what I learnedin my profession was in the job
.
And then like you said you knowlike you get slammed down.
And I didn't really learnbusiness until I owned my own

(11:33):
business, had my own employees,was making contracts was going
out there trying to sell ourservices Cause I had a mobile
x-ray company in the state ofFlorida for about seven years
and that was like a Harvardeducation.

Speaker 4 (11:44):
Yeah, but you know what it's also.
It's like think about it, howlong would you have to be in
school for them to teach you thesubject matter?
And then like how to do it ingeneral, Because I mean, listen,
it's at least in law school.
It's a completely differentlanguage.

Speaker 5 (11:58):
My question is this, and I'm just thinking out, like
I know I've run into this theydon't necessarily know whatever
law school that you go to whereyou're going to practice, and so
I think we think those thingsvery, very much depending on
what state you intend topractice in.
So I mean, maybe there's thatcause, like I know for me, when
I teach a contract class inFlorida four hours, no problem,
plenty of subject I mean we can,I live in that neighborhood,

(12:21):
right.
But when I go to a differentstate maybe it's two hours and
it's just general concepts ofhey, look out for this, look out
for it Generally, because youknow your state, you guys decide
, I don't know, you keep thesnowshoes in the attic for some
strange reason, like I don'tknow why you do what you do.
So you think there's acomponent of that, maybe with
law school.

Speaker 4 (12:39):
I mean, look, there is.
But so most every state ispretty similar in terms of
general concepts of law, okay,concepts of you know what we
call tort right, which is likeyou know, accidents, negligence,
people falling down, contractokay, obviously constitutional
law is the same Sure and a lotof criminal procedure.

(13:02):
In when you're in law schoolthere's two kinds of criminal
law type classes generally.
The first is criminal law, okay, which you take as a
requirement, okay, and that'syou know the intent, you know
they teach you about intent,crimes and mens rea and things
like that right.
And then there's a criminalprocedure which is largely

(13:23):
constitutional.
Comes, like the Supreme Courthas typically decided a lot of
this, like the state governmentswill codify or not, but so in
most states it's the same.
Like the rules for a trafficstop, like don't really vary
from state to state, so moststates are similar in the way
they do things.
And then what you'll have islike particular creatures of

(13:44):
statute.
California, yeah, like goodexample is Florida, in Florida's
like I think still might be theonly and I knew this better
when I practiced in this area,but Florida's the only state
that treats vehicles as what wecall a dangerous instrumentality
.
So what happens is if you loanyour car to someone in Florida.

Speaker 2 (14:04):
You're like lending him a gun.

Speaker 4 (14:05):
And they crash, you are going to be liable and it's
their fault.
Right, you're going to beliable for under like this
vicarious liability theorycalled the dangerous
instrumentality doctrine.
Okay, so your insurance will beimplicated and then the driver
will also be implicated.
You know typical negligence,you know you made the mistake.

(14:27):
So I often tell people it's badnews to buy cars like in your
individual name.
Okay, especially if you don'thave like a lot of insurance.
Like, of course, you'rerequired to carry insurance, but
if you purchase the car you'reonly required to have like a 10
and 30, what?
we call a 10 and 30, 10,000 and30,000.
Nobody goes to the carinsurance guy and they're like

(14:47):
can you sell me more insurance?
In fact, you're trying to figureout how to keep the payment
down.
And they ask you shit.
And people are so stupid aboutinsurance that when you decline
certain coverages, they make yousign forms acknowledging that
you declined the coverage Causelater on when you crash.
A great example is GAP okay orunderinsured.
You know a UM underinsured orno insured okay.

(15:08):
So you go there and you'rebuying insurance and the guy's
like do you want the GAPcoverage?
And you're like what's the GAPcoverage?
And they're like, oh, it's just.
You know how much does it cost?
It's like $8 more a month.
They're like, fuck that, I'drather pay $72 a month for car
insurance than 80.
But the gap is that your car isfinanced, your car gets totaled
.
Insurance company says, oh, youowe 25 grand, we're gonna give

(15:30):
you 18 grand for the car.
And then people call me andthey're like, oh, I still owe
$7,000, I don't have a car.
And I'm like, yeah, did you getGAP?
And they're like GAP, theydon't even remember being asked.
So you email the agent.
The agent replies he doesn'teven answer.
He replies with the denial, therejection.
Here you are rejecting the $8GAP coverage and that's what GAP

(15:51):
is for that's why they call itGAP it bridges the gap

Speaker 5 (15:53):
between what the?

Speaker 4 (15:54):
carrier's gonna pay you and what you owe the bank.

Speaker 5 (15:58):
Yeah, you gotta look at what the coverage you need
when you lease is because theyare very much concerned with
making sure their liability isclear.

Speaker 4 (16:03):
Well, on a lease obviously.
That's why on a lease they makeyou carry more.
It's $100 and $300, andespecially in Florida.
So I mean again, we'vedigressed.
But if you're gonna buy carsout there guys, buy open a
company just for your cars.
First of all it makes it anexpense.

Speaker 2 (16:17):
The turro, the turro.
Well, I was actually gonna gointo that, so let's talk about
that.

Speaker 1 (16:21):
That's a good question because, yeah, because.
I typically a lot of people askme hey, I got this car.
You know you're always gonnabuy it in your personal name
because you're gonna get thefinancing.
They're gonna pull your creditsocial security.
And then they ask me oh, shouldI put it in the business name
after?
Does that matter?
Like, have you titled it with aDMV in the business?

Speaker 4 (16:39):
No, I mean so.
First, you can avoid thefinancing hiccup by you're
always gonna guarantee so at theright.
So, yeah, so you're gonnaguarantee it.
There are a lot of banks thatwon't finance, like, for example
, there are some banksparticularly for, like, high-end
luxury vehicles that do thoseloans and they'll only do it in

(17:00):
your individual name.
Okay, and those banks areusually in California where they
don't understand this dangerousinstrumentality concept.
But here I mean myrecommendation is you open an
LLC.
You know you call it.
You know Cadillacs Cars rightLLC Didn't see that camera.
And then right.
Well, it was low hanging fruit,of course.

Speaker 5 (17:19):
I mean, I don't be grudging to that, I'm just
saying that.

Speaker 4 (17:23):
And you know you buy the car in the LLC, okay, the
bank's gonna make you personallyguarantee it, but that's no
problem, like that.
You're not the owner, you're aguarantor of the loan.
Now, the owner is the company,okay, and so you loan the car
out and they crash.
You know, usually the exposureis gonna be limited to the
assets of that company, right,which obviously you're gonna
have insurance as your firstlayer.

(17:44):
But then what else does thecompany have?
Nothing.
It's got a bunch of cars andthey're all fucking financed
Right.
So like there's no assets.
Now, if you're driving the car,right, we can never avoid our
own negligence.
So if you're driving the car,your personal assets are also
gonna be exposed but it justcovers at least the loaning cars
.
You know like people that loancars and don't know about this.
They're fucking crazy.

Speaker 5 (18:05):
So the general people need to definitely be aware of
this and be making sure to havetheir cars, so Lease, lease.

Speaker 1 (18:12):
I thank you for that.
Yeah, my pleasure.

Speaker 2 (18:14):
Tax wise.
Lease versus Purchase.
What are we looking at?
What's better If we're gonna goand incorporate?
Because again these realtorsusually and I'll turn themselves
into a PA which basicallyincorporates yourself and
everything like that same as anLLC, pretty much what you call
it right.
So what's better?
Tax wise.

Speaker 1 (18:34):
Lease or Purchase.
It all depends on businessusage of the car, the percentage
that you're using it for.
Is it a newer car, is it older?
So?

Speaker 2 (18:41):
every deal that's gonna.
I call it a new car and I useit to drive to work every day.

Speaker 1 (18:46):
So we just for your business, yeah, so basically you
could probably substantiate ahigh percentage use of business
or that.
So I would.
In most cases, I like the factto do the purchase on it because
you could take the bonusdepreciation and the section 179
, in some cases if it's over6,000 pounds, but if it's not,
then you could take the bonusdepreciation on it and then

(19:08):
deduct it.

Speaker 2 (19:10):
Is it true that our friend Biden dropped that to 80%
and then next year is 60% andthen the year after that it's
gonna?

Speaker 1 (19:15):
sunset.

Speaker 2 (19:16):
Unfortunately.

Speaker 1 (19:17):
Right, that's gonna disappear, Huge yeah, it was a
huge bad effect.

Speaker 4 (19:21):
So who says that Biden did that Just out of
curiosity?
Who says that Biden did that?
Yeah, because, do you know,it's under his administration.
I mean.

Speaker 3 (19:29):
But I mean a change to the tax.
I don't know Trump did it, I'masking.

Speaker 2 (19:31):
I'm asking we're actually gonna have that?
Trump did it.

Speaker 3 (19:35):
I'm asking about how the change.

Speaker 2 (19:37):
I don't know the answer.

Speaker 4 (19:38):
I'm asking about how the change to the tax code came
about.
I don't think it was byexecutive order.

Speaker 2 (19:44):
Well, we could pretty much say that Biden isn't doing
anything right now.
He could barely walk.
Okay, I'm okay with that.
Did he walk up to the IRS andsay, hey, I need you to do this?
I doubt it.
Is it his administration thatplays that game?

Speaker 4 (19:56):
Then let's just don't know that.
That's how the rule changed.
I'm just saying he said he saidit was gonna sunset.
Do you know what that means?

Speaker 2 (20:02):
Yes, Okay, so I literally spelled it out before
he said.

Speaker 4 (20:06):
So what that means is that when the rule was enacted,
it probably had the sunsetprovision in it.
In other words, no one has todo anything for those things to
occur.
That's why they're calledsunset provisions.
They happen without anyadditional action.

Speaker 2 (20:21):
After the original enactment of the law.
So I know that last year or theyear before it would get 100%
deducted.
It would any vehicle, and nowit's 80.
Next year it's 60.

Speaker 4 (20:33):
And then it's gonna sunset, and if the statute has a
sunset provision in it, whatthat means is that it was set to
do that from the minute it wasenacted.
In other words, no newpresident came in, not Trump,
not Biden.
No one came in and said, hey,this year it's 100, next year
it's 80, and the following is 60.
Because the law has a sunsetprovision, which means it

(20:56):
happens automatically.

Speaker 2 (20:58):
Understood.

Speaker 4 (20:58):
Now, I don't think you do?

Speaker 1 (20:59):
No, I think I do, and that's what you need to look at
.
We'll have to go back and saythe statute itself how did it
initiate?

Speaker 2 (21:04):
How did it so?

Speaker 1 (21:06):
It could have been part of the package of the of
who who passed it, the Tax ofJobs Act of it could have been.
We'd have to look in there.

Speaker 4 (21:12):
Yeah, I'm pretty sure that's what it was 2000 plus
Right, the one with thecondition there Right.
And when did that statute comeinto law?

Speaker 5 (21:19):
That was the big Trump tax cuts.
Right which had the businesstax cuts, I believe were
permanent and the personal oneswere.

Speaker 1 (21:27):
Right, that's right.
So let's look at which one wasit, In other words the law was
written for this to occur,irrespective of who's president.

Speaker 4 (21:36):
Do you understand what I mean now?
Yes, okay, so let's go back tohow our discussion started,
which is is it fair to say, isit true that Biden this and the
answer is no, it's not true.

Speaker 2 (21:47):
The answer is the law when enacted, so it's
absolutely a coincidence.
Was set to do that Right, soit's an absolute coincidence.
Yeah, this is why it wasdecided that the lawsuit for
Congress Right.
Fair to say, my entire adultlife, cars were vehicles were
depreciated 100%.

Speaker 1 (22:03):
Well, sexual, you're talking about sexual 179.
West.

Speaker 4 (22:06):
He has no idea.

Speaker 1 (22:07):
The 6000.
Well, that's bonus depreciation.
I can't ever remember when itcame to this existence.
That's not the yeah, that'slike a SUVs.
Right, I don't know how old itis, but I wouldn't say it's not
as old as we've been around.
I don't take bonus depreciation.

Speaker 3 (22:20):
That was like kind of you know like a stimulus type
of thing, yeah, so that's in oneof the tax packages.

Speaker 2 (22:26):
We know every new administration comes in and they
right now, all this stuff inthere that would include boats,
that would include planes.

Speaker 1 (22:31):
That would include section 179.
Yeah, you know, 6000, 6000pounds and heavier.
And then, yeah, obviously,planes, right, heavy heavy
equipment, things of that nature.

Speaker 4 (22:41):
But to answer the question you were going to ask,
yes, it's a coincidence, it isan absolute coincidence.
I mean, it just happens to bethat this provision, this
particular statute, has a sunsetprovision and, by the way,
that's put in when the statuteis passed and when it's created
that's correct and there's beenno impotence or leverage applied
to do anything to extend it100%, I would say that would

(23:03):
maybe be the fair middle groundin this statement, right.

Speaker 5 (23:07):
Yeah, it's not a priority to take and do this and
you know you could maybeunderstand that with what's
going on with inflation, wantingto take and reduce spending,
because consumer spending is oneof the things that largely have
said has driven this.
But I think there's otherthings baked in the cake that
are going to put the damper onthat.
That's a different topic for adifferent time.

Speaker 2 (23:27):
So you're looking at all right.
So let's can we talk a littlebit about when incorporating
yourself and what are the taxbenefits on that, like you know,
becoming a PA, or you know, notowning what Richard mentioned,
not owning real estate underyour own name, not owning and I
know that that's more of a legalpart, you know as far as
liability is concerned, but asfar as taxes are concerned,

(23:47):
incorporating yourself, turningwhat every realtor is told to do
, which is turn yourself into aPA, basically, what are the tax
benefits, yeah.

Speaker 1 (23:54):
So I mean, I don't know if you have training for
your agents and you guys maybetalk about this stuff.
I remember many years ago.

Speaker 2 (24:01):
I don't, but I would like to.

Speaker 1 (24:03):
I had to go to a large real estate brokerage
similar to your company here inSarasota and just teach the
agents on getting not onlybecoming a PLLC because they
were licensed in the state ofFlorida, but also converting
that to an escort and how to dothat and why to do that Right,
because I was getting even in myoffice.
I was getting real estate agentsthat were just putting

(24:24):
everything on their schedule,see if they're 1040 and paying
the 15.3 percent self-employmenttax.
And then, even worse, was onelady.
She came in like a 2009, shehad her taxes done by somebody
else and she winded up gettingaudited because she produced a
loss.
Nobody was buying houses in2009 because the market had
crashed.

Speaker 5 (24:44):
True story I was there, yeah, yeah, so you guys
know.
You said 2001,.

Speaker 1 (24:48):
You started, so you know exactly what I'm talking
about.
But she her husband made a lotof money.
He was a doctor and he wasmaking I don't know $400,000
plus and she had like a $35,000loss.
She was paying her desk fee,paying her lease, she was doing
everything still marketing,still getting her CE credits,
all that stuff and everythingwas substantiated.
She had all the receipts andthey still audit at her because

(25:09):
she had put everything on herschedule to see and offset
everything against her husband'swages.
So they got produced a refundand they got tagged and she came
to our office.
She's like you know, I got allthese.
Can you help me with this audit?
So I said let's fight it.
And this guy was being he wasbeing a dick.

Speaker 5 (25:28):
IRS agent was being.

Speaker 1 (25:29):
He was yeah, exactly, but this guy looked like
something he looked likesomething out of a, out of a,
like a character, out of like amovie or something, and the guy
could hardly see.
He had a huge magnifying glass.
Look, he had to put everyreceipt underneath and look at
it and he was like it was takingforever.
She got so frustrated with it,she just wanted to pay and said
forget it.
So then you know, after that Itold all my real estate agents

(25:50):
to make sure that their S corpson there, just you know, because
you're going to savesignificantly and also you're
going to what is.

Speaker 2 (25:56):
Can you be a little more detail in that?
So so, if I'm talking to a realturn, I'm like I'm trying to
explain to them, hey, why it'simportant to turn yourself into
a PA, basically incorporateyourself.
How does, how does that, howdoes the dynamic work?
Like what, what, what is it?
What am I explaining exactly?

Speaker 1 (26:10):
Well, you're also there's two divisions in the IRS
.
So you have two for forexamination or audits.
So one only pertains tobusinesses, which would be S
corps, maybe partnerships and Ccorps, and they don't touch
1040s, and then the other one isjust all 1040s.
So if you're putting all ofyour business activity on the
schedule C, then you're giventhe IRS and that auditor guy

(26:32):
jurisdiction over your business.
So I don't like that personally.
So I'd rather have it come inthrough and I K one and then
they'll just match the K onethat's filed on the transcript
with the IRS.
So I mean that would be one ofthe besides the tax savings that
would be.
The other thing was to, youknow, divide the two, two
entities and then put your Scorporation activity into a pool

(26:54):
of other entities that are muchgreater than yours.
I mean because this versus Evan, just you know everything on
your 1040.

Speaker 5 (27:02):
Yeah.

Speaker 4 (27:02):
But I think the main talking point, that is, when
you're talking to agents, iswhat he was saying the tax
savings side.

Speaker 2 (27:09):
Right, I mean, and that's really, but that's,
that's what it's?

Speaker 5 (27:13):
because you're going to write off gas and write off
right.

Speaker 4 (27:18):
Expenses.
I mean, you shouldn't listexpenses.

Speaker 1 (27:20):
Well, either way, if you're going to put it on your
1040, you could still.
You're still going to take thesame deductions.
The other, the major thing isif you put your activity for
your real estate commissions andyour expenses on a 1120 S
that's the form for the S corpYou're still they're still going
to be a profit loss statement,right.
But you're taking a portion ofthat ordinary income and you're

(27:46):
construing it as W two wages toyourself, yep, and then you're
paying it on that.
So let's say you make a hundredthousand dollar profit, take
50,000, pay the self employmenttax on the S corp through there,
so you're only paying 7,500bucks versus you're going to get
whacked for 15,300 on your 1040if you don't do that Right.

Speaker 5 (28:05):
So basically, 100% of your taxes, your wages, are
taxable because it's shown asordinary income that you're
paying.
You're getting correct.
You're just dividing it,correct.
So now you're just taking theprofit portion, what's left over
and saying I'm going to payemployment taxes that 15 plus
percent or your wage doesn'teven have to be profit, just
whatever you earmark foryourself.

Speaker 4 (28:25):
I know yeah.

Speaker 5 (28:26):
Because that's exactly how I do it and you can
see how little I pay myself.

Speaker 4 (28:29):
Honestly, I'm going to have to go to HR about it or
something, and it's not good.
No, we don't want to.
It's not good.

Speaker 2 (28:37):
Yeah.

Speaker 3 (28:38):
And that's, and that's the way away from
memorializing.

Speaker 1 (28:40):
I don't know, Do you train your guys.
Nowadays, like everybody, iskind of like pretty much a
standard thing that you would.

Speaker 2 (28:48):
I don't give training everybody.
I don't give training on thatand I should not now talking to
you.
That's something we shoulddefinitely maybe you should not
why.

Speaker 4 (28:56):
Oh, because my attorney went like legal advice
that you're probably notlicensed to give or not, I'm not
going to bring somebody in.

Speaker 3 (29:02):
Oh yeah, I don't super.
Yeah, that's what I meant.
No, no, no, absolutely.

Speaker 2 (29:08):
I'm absolutely not doing.
I'm saying like bring, bringsomebody in, and you know, kind
of especially like on camera.
Yeah right, no, I'm definitelyfor the rap.
How do you?

Speaker 4 (29:17):
plead to the unlicensed practice Not guilty.

Speaker 3 (29:19):
It's like judge and it's like play.

Speaker 1 (29:23):
This is why you legally want to do this shit.

Speaker 4 (29:27):
You know, on the big screen yeah, I know, but now it
is, you get the defense.
That's AI.
That's not me, that's AI youknow.

Speaker 2 (29:33):
Going back, yeah, I don't know if you guys have read
the book the millionaire nextdoor.

Speaker 1 (29:38):
Yes, I remember that one, yeah.

Speaker 2 (29:39):
That's an interesting one.
Yeah, basically you know it.
Through these tax return, irsstudies and everything, they
kind of figure out what, likemost you know,
multi-millionaires drive right.
That's the one that reallyimpacted me, like what, what
card do you guys think that mostmillionaires?

Speaker 4 (29:53):
I read the book so we're in fucking Miami so you
know it's not a good indicationthat no, we're.
We're in the new money capitalof the world.

Speaker 2 (30:00):
Yeah, so you hear Tesla right, yeah, right.
Here you think you know it's it.
The culture is completelydifferent, right?
So everywhere else in theUnited States, the most popular
car is a Ford F 150 pickup truck.
That's the most formillionaires, yes, for
millionaires.
Not one car driven bymillionaires, wow, yeah.

Speaker 5 (30:18):
Yeah, I mean it's.
This is the thing, right, andyou hit on it earlier the idea
of not living within your meansbut living below your means.
One of the reasons why I getaway with paying myself so
little is that I actually liveon very little, right, I live in
a.
I still live in a condo.
I still live in a three bedroomcondo.
I'm not nothing crazy oranything like that.
All of my, whatever I bring in,I invest as much as I can, right

(30:39):
, and so the idea that's theidea that, to me, is the one
that's missing from school.
It's not about you know yourcheckbook and how, no, it's the
idea that you need to consumeless than what you make and
allocate as much as you can toinvest, because the only way
long term to get ahead is toallocate as much of your capital
to investment as you possiblycan.
The investor class hasoutperformed every way, maybe
with the exception of the actorsand movie stars and athletes,

(31:02):
they've outperformed every wayduring class in this country.
Hands down, no, it's just nofun.
It's no fun today.
It's no fun today, but then,when you're done doing the thing
that you do, you can telleverybody to get lost, because
you can actually take and livethe way you want to live.

Speaker 4 (31:16):
Yeah, I'm going to work till I'm dead, so I'm going
to die at my desk.

Speaker 2 (31:19):
I'm going to the week after you're dead, right my
financial.

Speaker 4 (31:23):
Air and see knows no bounds.

Speaker 5 (31:25):
They're running in there on a on a on a hand cart a
week after you're dead, but you, you really.

Speaker 2 (31:30):
I mean we live in a place where the culture is you
show your money, I mean, and mypeople are the worst at that.
I mean they'll be living, youknow, in an efficiency with
concrete backyard.

Speaker 4 (31:43):
I saw it.

Speaker 3 (31:44):
I saw it.

Speaker 2 (31:45):
I saw the other day somebody's getting interviewed
on in a.
You know what we call anefficiency here.
I don't know what you call thatin New York.
Is it an efficiency?
Same thing Like a studio studio, studio.

Speaker 3 (31:56):
Is it really a studio ?
I mean not even a feature.

Speaker 4 (31:59):
Yes, I feature right here, but but, um, that's code
for one little room with thetoilet and the kitchen in view,
everything in view.
Right, so you can watch thedishes.
So this guy?

Speaker 2 (32:09):
so this guy's getting interviewed in an efficiency
right and a studio, wherever thehell you're at right and I
straightly I wonder what it'scalled.
But the uh, and he has, dude,I'm talking about a lot of gold
on him, a lot of gold right,like.
So that's the culture, right,so that's the culture.

(32:29):
And you know, listen, richardand Catalan know that my
fascination actually justrecently found that, I tell you,
I found that I'm actuallyJewish.

Speaker 3 (32:37):
No.

Speaker 2 (32:38):
So I'm doing my riches, yeah, right.

Speaker 4 (32:40):
But I don't have my boots on.
And the bullshit is gettingthick.

Speaker 2 (32:44):
Well, well, I go to get, um, I'm in the process of
getting my Spanish citizenship,spain, right, it's whatever it's
, it's long story, but, um, andso there's a.
There's a, there's a websiteyou go to and your your last
name, the list of last names,and that means you're like a
Sephardic, or Sephardic to myJewish, enough to know yet.
But uh, but uh but yeah, ifyou're on that.

(33:07):
If you're on that list, you knowyour, your, your family, at
some point was in Spain and hadto leave for religious, for
religious, for sure.
But whatever, back to the backto the.
The culture of, of, of the, ofthe, of the Jews is usually, you
know, uh, frugal.
I mean, you're, you're, you're,you're basically bred into
consuming as little as youpossibly can and investing as

(33:28):
much as you can.
The Chinese very similar right.
The Chinese are the same thing.
They have the highest level ofof of self-employment.
You know what's the last timeyou saw a Chinese working for
anybody that's not Chinese.

Speaker 5 (33:38):
I'll give you one better man.
I mean and I I read thissomeplace, I'd have to take it
and check the source but thesecond wealthiest people you
were telling the line there.

Speaker 4 (33:46):
We're going to get a lot of commentary on some of
this.
Jesus got into Jewish cultureand when we're is the last time
the Chinese worked for anon-Chinese Can you imagine.

Speaker 5 (33:55):
Which is true though.

Speaker 3 (33:59):
Hey, I don't give a fuck.

Speaker 5 (34:00):
I'm at the fact let's let's toss, one let's toss one
more in there in the fire, Isuppose which is this that the
second wealthiest people groupin the United States by country
of origin is actually theVietnamese.
Both people the Vietnamese.
Vietnamese?
What people?
The people that escaped Vietnamto escape the, the, the, all,
the all that went on there.
And so, um, really, yeah, andso once, once again, a group of

(34:21):
people that don't, you know,look like the, the main, you
know, the, they're.
They're not the majority in thecountry, they're a obviously a
minority.
Um, you know, we could kid thatthey own every nail salon
between here and Tibet but theydon't own that I think that was.

Speaker 3 (34:33):
I think that was racist.

Speaker 5 (34:34):
Oh, absolutely.

Speaker 2 (34:36):
But, here's the crazy thing.
There's the crazy thing.
There he fucked up.
I was okay.
Here's the crazy thing, man,they own the nail salon.

Speaker 5 (34:43):
You're getting deeper .

Speaker 2 (34:44):
You're getting deeper and they own.

Speaker 5 (34:45):
they own the shopping center as well.
They live three generationsunder one roof.
Um, they have a culture that isbuilt and set up to encourage
underconsumption and allocation,especially really a huge real
estate investor, Can you imagine?

Speaker 4 (34:59):
three generations living three generations under
one roof.
I mean I don't want to livewith my grandmother, bro.
No, I just want you to knowthat.
Yeah, so listen, likeeverything else, like everything
else there's extremes.

Speaker 2 (35:08):
right, there's extremes, but my point is that
that, um and I'm only going tofocus on my own culture, because
that's the one way to you don'tget in trouble is just shitting
on your own, on your own people, um, but you know, thank you
for that.

Speaker 4 (35:20):
Yeah, I appreciate it , the Cubans are you can shit on
Cadillacs people.

Speaker 2 (35:25):
Oh yeah, why, people is true.
Oh, I'll shit it.
Why don't we all know who wecan't shit on?
So, so um the Cubans.
The Cubans tell us.

Speaker 5 (35:40):
Wait, I don't know, can you enlighten me, illuminate
.

Speaker 2 (35:44):
Illucidate.
So the Cubans are.
The culture is, you know, spendand, and, and it's very show
offy and and, and you know thattype of stuff which which, um,
man, it's hard to get out of Ifyou're in it every day and you,
you're, you're, you're, you'rein it.
It's hard to teach your kidsyou know to live, you know
different than what they seeevery single day.

(36:04):
Cause, and especially withsocial media and stuff nowadays,
man, it's like you knoweverything is Ferraris and
Lamborghinis and everything likethat.
What they don't know, andthat's the argument I had with
um, there's a couple of buddiesthat I argue this this you know,
uh, my kid has to be a pro.
Are they all in on the kidbeing a pro athlete?
They're all in?
Oh, it has to be a pro.
I'm like, because that's the wayto make money, Right, I mean,

(36:24):
and these guys come from theculture of these, these guys are
from the hood and and, andthat's what you hear there and
that's what you understand there, Right?
Um, and I'm like, man, that youdon't what you don't understand
, that there's a little Jewishguy somewhere, right, that owns
every damn shopping center thatyou drive, that you see on your
drive to work every single day,right, that makes way more money
than any of those guys, Right,Um, and forever, not for three

(36:47):
and a half years, not for sixyears, not for anything like
that.
So, if you compare, If you, ifwe're talking about all, right,
um, what we wished our parentswould have done for us, right,
Kind of like, got a lot.
Got a lot of that, though.
Got a lot of thatself-employment talk from his
old man, but his old man was anold man.
You know he fucking went throughit he was what?

Speaker 5 (37:05):
80?
No, he passed away at 72 man, Iwas only like 20 years old
right, so you got.

Speaker 2 (37:10):
You got a 50 year old guy giving you.

Speaker 3 (37:14):
Advice.
I mean, I was getting it too.
My old man wasn't.

Speaker 4 (37:18):
I mean, listen, god bless him.
He was successful in his ownway, but God fuck yeah.

Speaker 3 (37:23):
The right was the wrong detonated like eight times
.

Speaker 2 (37:26):
Yeah, he set a record for it.
Yeah, yeah, yeah so, but butyou know if, if you're, if
you're, if you're raisingsomebody and again what we
wished is like all right.
So you know how do you consumeas little as you possibly can.
You know how much, how much doyou invest?
You know.
You know, listen, beingself-employed is not for
everybody, but at the end of theday, you know most.

Speaker 5 (37:47):
Most millionaires, billionaires, yeah, our
self-employed and somewhereanother.

Speaker 2 (37:51):
So you know that, that, that that type of culture,
you know how do we?

Speaker 4 (37:56):
it's a good thing that most people aren't like.
Don't think about beingself-employed though, because
then Nobody to work.
Self-employed, I mean mostpeople want to have a defined
it's not for everybody List oftasks that they have to
accomplish.
Then they want to know hey, I'mgetting a check for as most
people can't administerthemselves right but they just
well not just that, but theanxiety Sucks, sure?
no, they can't tell you what, asyou know it's funny when you're

(38:20):
a lawyer or like a doctor.
You know it's like.
You know people think you're akid and you're growing up.
You know it's like what do youwant to be at?
Like career day and kids comein and like invariably they're
like I want to be a lawyer, Iwant to be a doctor doctor.

Speaker 3 (38:33):
CPA another way to be an accountant.
Yeah, I want to be a baseballplayer right.

Speaker 4 (38:36):
I want to be a firefighter, I want to be
policeman.
Nobody walks in to school.

Speaker 2 (38:41):
You just went down.
I think it's considerably there, you know no, and nobody walks
into school.

Speaker 4 (38:44):
I know, but that's what, those are the careers that
people think of.
They don't walk into school andthey're like, oh, I want to be
the regional manager of theoffice depot and control six
office depots, okay, and thatguy's probably doing pretty well
, you know.
But but then went with these,like these what I call license
professions, right, or what theycall.
What are they called?
Like advanced degrees orwhatever?
You know, when you think aboutbeing a lawyer, you don't think

(39:06):
about the business side of beinga lawyer.
So, like when I came out ofschool, I went to work at a big
firm and I'll never forget that.
You know, we'd get a file, okay, and you could see that the the
plaintiff we did insurancedefense, okay, and you see that
the plaintiff had gotten intolike a car accident, and you
know, and he went and saw thedoctor and you'd see Lee.

(39:27):
You know you'd ask him aquestion what's the doctor you
saw in an interrogatory and theguy replied you know, dr Valdez,
whatever it is, and withouteven thinking about it, I would
turn and say subpoena drValdez's office for the records.
And since it was a big firm, myassistant was like, yeah, okay,
subpoena the office and youdon't wish is my command.
You don't even think about thecost of the subpoena.

(39:47):
So then, when we were leaving,when my Former partners and I
went to the managing partner totell him we were leaving I'll
never forget that he looked atme and he said you know the?

Speaker 2 (39:57):
no idea is we were three.

Speaker 4 (39:59):
We were three Cuban lawyers.
Okay, yeah, or Cuban, you know,heritage lawyers, whatever.

Speaker 2 (40:04):
I'm happy to see you admitting your killing.

Speaker 4 (40:06):
Yeah, yeah, happy for you, begrudgingly yeah and so
he looks at us and he says youknow, you guys, you all have
this yeah yeah, no, no.
Mr Cole, you know you don't sayanything.
He'll be mr Cole forever and hesays no, you know, he goes,

(40:29):
you're, you're all veryentrepreneurial.
You have this entrepreneurialstreak and like saying your
people or yeah, the Cubans, ohyeah, and so, absolutely, and.
And and he was like so itdoesn't surprise me.
And then he looked at me and hesays the thing for you is that
you didn't spend enough time inthe classroom and I didn't had
no idea what it meant.
Okay, and then the classroom wasactually there, right right and

(40:50):
so when, when we go out to youknow to open the firm and we're
like working, then I realized,like two years later what he
meant.
Because you know, when you're ayoung lawyer and you, you think
you're gonna do the smart thingand open your own firm, you're,
you got to realize how muchtime you're gonna spend being a
businessman and not honing yourcraft.
And what do I mean by being abusinessman?
You got to negotiate thefucking lease for the space, you

(41:11):
know.
Oh, guess what?
You know what we need.
We need copiers.
Okay, when you look, you knowyou Google a copier.
Okay, it's 80,000 bucks.
So you're like I can't spend.
I said, no shit will lease itto you.
Okay, so get ready to sign thepersonal guarantee.
And how many?
How much are you paying forprints and how much you paying
for color?
And how much are you paying forcopies?
And are you gonna build thatback to the client?
You got to set up email phones.
I used to joke that my formerpartner and it wasn't true, but

(41:34):
I just like to tease him youthink you're gonna go to Best
Buy and buy a phone and fuckingplug it into the wall and
Loughurn.
It's like you need a fuckingphone system.
It was called a PBX.
Now you got voice over IPphones and then your staff wants
fucking insurance.
You're like what the hell isthat?
A Email is down.
Email is down is a panic, soyou can wake up and spend your

(41:56):
entire fucking.

Speaker 2 (41:57):
Well, and his partner haven't practiced one second of
all.
Here's the funny thing thatRichard partner I'm a former
partner, former partner was veryhe hated when you call him
aloof, but I could call himwhatever the fuck I want.
He was aloof, right.
So an issue would happen andthen Richard was the only one
stressing out about it.
Listen, so the phone wouldactually go down, and it was

(42:18):
Richard.

Speaker 4 (42:21):
All bull shit aside, we had our things.
My former partner is a greatguy he's, but he loves being a
lawyer.
Like he literally wakes up inthe morning and he's like
Another day of being a lawyer.
I'm like Emails down the phonethe line of credit a overdrawn,
you know?
I mean it's like I haven'tdealt with one of my client's

(42:42):
problems yet.
It's like one o'clock in theafternoon, Fires all day.
So you know you have to and youdon't, you don't get the time to
hone your craft, and it's, it'sthat.
So now, many years later, likeit's funny, I see things that I
did, let's say, 15 years ago.
Like I wrote a contract forsomebody as a buddy of mine.
He's a wedding photographer.
Okay, I talked to him the otherday and he was like well, look
what I found.

(43:02):
And he emailed me the firstdocument that I prepared for him
.
Listen, bro.

Speaker 2 (43:07):
That's all the contracts I got.

Speaker 4 (43:08):
I wanted practicing with me.
I wanted to.

Speaker 2 (43:10):
That's what.
That's why he could saywhatever he wants, but he was
practicing that's why, of course, that's why we call it the
practice, the practice ofmedicine.

Speaker 4 (43:22):
No, I looked at it, I opened it and I was like delete
a mine.

Speaker 3 (43:26):
And then I was like can you do that on your end?
Oh my god.
So I would call the office yourprice.
I would call the officesometimes.

Speaker 2 (43:33):
So when they started, when they just started getting
a little bit bigger the firm,they started getting a little
bit bigger and I wouldn't beable to get to them as fast as I
could.
I would get super fuckingpissed off and you know that I
would call the front desk andI'd be like they're like who is
it?
I'm like who is it?
I'm like, how about it's client001, fucking client of the firm
?
How about it's that?

Speaker 3 (43:55):
How about you pass me on right now?

Speaker 4 (43:59):
By the way, but tell him where 001 comes from,
because my partner, my formerpartner in his Incredible
efforts to like make people feelgood and appease a guy like no,
no, all your files start with.
We call them base numbers.
You know, you have like a basenumber you assigned to a client

(44:21):
and then if the guys got 10matters, that you know.

Speaker 2 (44:23):
There's a zero one dash zero.

Speaker 4 (44:25):
One, dash zero two, you know like Jesus's base
number was zero zero one.
He comes zero zero one.
But there's a great Lawyerbusinessman story.
There's this guy, he's a lawyer, is in his office and a client
walks in.

Speaker 3 (44:38):
Oh, there's a story story.

Speaker 4 (44:38):
No, no the client walks in, well, I guess back in
the days when you would walkinto a lawyer's office, you know
, and you know that the theclients looking at the lawyer,
he sees them in the desk and theguy, when he sees him, he picks
up the phone the lawyer andhe's like yes, yes, no problem,
no, we're gonna file that motion.
Yeah, no, I'm gonna object toit.
Yeah, okay, good, see you,we'll talk later.

(44:59):
And when he hangs up, he looksup, he's like how can I help you
?
And the guy's like I'm here toconnect your phone.
It's.
I'm telling you, it's hard outthere, bro.
Your fucking email goes down,phone goes down.

Speaker 2 (45:14):
It was a disaster when you were at your dad's
office.
It was really funny too,because it was like you work

Speaker 1 (45:18):
in somebody else's office and that's You're what's
called the managing partner youdo what all the funny is?

Speaker 3 (45:24):
I wasn't.
That's why, jesus, that's whatthe joke was my, my.

Speaker 4 (45:27):
My former partner was five years my senior.
He was actually my, myimmediate supervisor at the
first firm that I worked at.
So you know, when we left outof deference and all that and
because it would look weird for,like, the one-year lawyer to be
the managing partner, so youknow, he was the managing
partner, but I'm the one thathad to deal with things like
that, so that it was doublyagitating.

Speaker 5 (45:47):
So I mean so when you have when your partnerships
I've dealt with this beforethere's almost like a stare down
as to who's gonna take and haveto like how long are you
comfortable with the emailsbeing down?
No, no, no who's?

Speaker 3 (45:57):
gonna take the granade rolls in.

Speaker 4 (46:01):
And you look at the other side and you're like I'm
not gonna jump on it.
Are you gonna jump on it?

Speaker 5 (46:07):
So yeah, you lost that game of chicken with your.
I would.

Speaker 4 (46:09):
I would fucking just jump on it because the stress
was less I know.
I know, it's a disaster,because then Coincidentally,
have a guy like Jesus callingyou on the cell.
Oh yeah, bro, yeah, I can't getthrough your office phones down
bro.
You didn't pay the bill, so youknow now the blood pressure is
like this I Don't want to getthat call.

Speaker 2 (46:30):
Yeah.

Speaker 5 (46:31):
I mean, like the one thing like that nobody talks
about budgeting for, is the TumsAssociated with?
You know the ant-ass.
It's horrific.
And especially you know abusiness where you don't if you
don't kill, you don't eat youknow, customers in nothing
happens.
It's hard man.

Speaker 2 (46:44):
It's a tough thing, but I think I want to trade it
for the world, though I wouldn't.

Speaker 3 (46:49):
Oh no, I know.

Speaker 2 (46:49):
Richard.
Always, from the beginning, hefucking hated every second of
being being self-employed like I.
It's probably because I don'tthink I'm employable either.
Like where am I gonna?
Enormous problem with authority, like you know, doesn't follow
directions.
I mean, like where am I gonnago?
You know there, this is, thisis this is it.

Speaker 5 (47:12):
This is your lack of options has fueled your
contentment.

Speaker 2 (47:16):
Yeah, people listen, in 2008, everybody was come.
I think something like 80something percent of real estate
companies closed down.
I Couldn't close down, yeah,yeah, what am I gonna do?

Speaker 4 (47:29):
That like contraction and things went Multiple
offices with fucking airplanesflying around to the offices to,
like you know, one office IWould.

Speaker 3 (47:39):
I would go, I would go to like.

Speaker 4 (47:40):
Orlando or St Pete.
I'd go back to my law schoolfor some reason and I, wherever
I was, I'd see like a realtycompany sign and I'd take a
photo of it and I'd send it tothis guy.
Be like look bro, kellerWilliams, location number 3064,
crushing it like you know, youknow.
Yeah, why don't you know?

(48:01):
Oh, you're about to go with thetime I told you to close your
business.

Speaker 2 (48:09):
Well, which time?
Well the.
And then I started getting,when I started getting letters
from, from Keller Williams andand these bigger companies, the
first fucking idiot that I wouldsend it to.
Look who wants to look whowants to do business.

Speaker 4 (48:21):
Look who wants to turn into a fucking killer.
That was coming from their DEIdepartment.
You didn't know.
They were like let's getourselves a little Mexican.

Speaker 3 (48:32):
I.

Speaker 2 (48:34):
Think that one right there you're gonna get into
before so let me ask you aquestion.

Speaker 1 (48:37):
I and you can answer this too, because you're, you
know, self-employed.
But was there ever a time whenyou had to pay everybody?
Yes, you went, you, you wenthome with no money Of course,
yeah was there ever, that that'sokay.
Well, that's what got me allthe like he's talking about this
you know, being in business isnot for everybody, so I ate up.

Speaker 2 (48:53):
I ate up into all my reserves, which basically almost
bankrupt me.
You know, because I was payingeverybody, I was like, oh well,
2008 crash, how long can it last?
30 months, four months, fivemonths, let me just continue to
pay everybody, not pay me, andjust yeah, so everybody with the
office.
So I changed my the way I dobusiness to everybody.
Everybody in my office is verylittle salary, high bonus.

(49:13):
If I'm doing bad, you're doingbad those days of me sitting
here, right, that's why I did it, because I remember sitting
here and I'm like, bro, my worldis ending, yeah, yep, and
everybody everybody out there.
Yeah, thinking you're livinghigh on the right and what it,
what it didn't create was asense of urgency for my entire

(49:34):
team.
Right, I was the only one withmy head on fire.
Right, I was the only one superstressed out.
And no, now you know what, dude, if this company does bad,
everybody's doing bad.

Speaker 5 (49:44):
That's the biggest thing that I took when I read
Charlie Munger's book.
That was the biggest thing, ohreally so Charlie, charlie
Munger is yeah yeah, so CharlieMunger said they do some of it.
As it turns out, they delegateeverything that they do except
one thing compensation.
They always make sure thatthey're very careful with how
they compensate, that there arepeople to make sure that their
best interest Right and theperson they're paying's best

(50:07):
interest are aligned.
So like if we, like you said,if they do well, then the person
does well, if they're not doingwell, they're gonna be plenty
of incentive there.
Yeah.

Speaker 2 (50:17):
Compensation.
I think the y'all need to be onthe same team, you know.
So, um, how'd you get into theCPA thing Like you just is that
you woke up one day and said oryou were you guided into it by a
family member, cuz you know, Iwas wondering how people pick
CPA, because that's.

Speaker 1 (50:33):
Self-loathing.
I knew it out of the businesstrack, you know cuz he had, you
know like marketing and you knowfinance.
I knew accounting was the onethat I wanted to take because it
was the most versatile.
But, um, my parents werebusiness owners too, okay, when
I was growing up.
So I saw that and I used to seethe account and come in so it
was what career would help me beself-employed?

(50:54):
The most, I guess, or would bemore she was doing well, and
then I got my first.
My first job was was the worstjob.
I used to count money in a bankvault in New York.

Speaker 2 (51:03):
That's pretty cool.
Yeah, this is pretty cool.

Speaker 1 (51:08):
Like one day you see the vault open in school.
Yeah, the problem was I wasclaustrophobic, there was no
windows and then I would getlocked in.
That it's like small.
It was like smaller than thisoffice here and we count all the
money, all the deposits fromlike a has and UPS and all that
stuff.
It was terrible.
But then I got promoted fromthere and then I started to work
with the auditors in thelending division because they
used to look at some that theloans right and I kind of like I

(51:33):
was getting some reimbursementfrom the bank to take more
Banking and accounting classes,so that's kind of, you know,
naturally gravitated to thatyeah and like the regret, like
Richard, sometimes, like Ishould.

Speaker 2 (51:46):
I don't know I did, I did like, whatever stage.

Speaker 1 (51:49):
I first I, when I first I, when I was working for
KPMG, kpmg I was miserable,right, cuz everybody was a
prototype, everybody talked thesame way and you know, you know
it was a great polishing schooland learning how to write memos
and you know kind of conductmyself in a professional setting
.
But I hated it and and it'svery rare.

Speaker 2 (52:08):
You know how like.
So it guys right.
It guys are usually weird sonsof bitches and and very risk
averse and everything like that.
Cpas are not usually weird, butthey're very risk averse
because they're.
That's what they're trying todo Right that's what I'm saying,
so it's very rare that you geta, an entrepreneur, right.
See, you know I mean likeyou're usually born with one
side of the brain.
You give you could count reallygood.

(52:29):
You're not really risk averse,you get.
So it's or you are risk.

Speaker 3 (52:32):
You're risk averse yeah so, yeah, it's.

Speaker 2 (52:35):
So it's one of those, it's one of those things that
usually you know, so it's it'srare to see.
It's definitely rare to seethat.
So, um, what, what's the bestadvice we can give these
realtors right now?
Is there anything that standsout that you, that you've seen
mistakes made or or, or anything, or anything like that, or just
, maybe not even realtors, justbusinessmen, like, is there some
mistake that you see over andover again that they kind of uh,

(52:57):
you know we could, we couldhelp them avoid?

Speaker 1 (53:00):
Yeah, like, if you can't do your own accounting,
don't try to do it.

Speaker 3 (53:04):
Right.

Speaker 1 (53:05):
Pay the money to get it done.
Yeah, you can get somebodyfairly cheap.
There's a lot of easy softwareprograms to link your bank
account to.
I get a lot of messes at theend of the year and it's going
to cost a lot of time and energyon our part.
We don't like to deal with it,so just pay somebody to do it.
Um, and you know, keep youorganized.
It's going to help you takeadvantage of getting all the
deductions that you need to notmissing things Right.

(53:26):
A lot of times you'll you'regoing to miss a time.

Speaker 2 (53:27):
So what gets people in trouble, right?
So?
So, like, how bad of an assholedo you got to be to to, you
know, go to jail for, for taxevasion?
I mean how, how blatant do youhave to be?
I mean, cause it's, it's, it's,you know, trying to find that
file yeah.
Line of how much I want to seehow far you go.

Speaker 1 (53:44):
No, there's the number one thing.
It's like that, ladies, thenumber one thing is putting your
real estate activity on aschedule seat of your 1040 in
and of itself, and if you'reproducing a loss is going to be
a red flag, you know there's ahigh chance that you're going to
get audited.
That's typically the number onething.
The other thing is, I think,just not matching your 1099s.

(54:11):
So if you're getting yourcommissions and you're not
matching that top line for, forwhatever reason, you miss one
Right and maybe they're gettingfrom multiple different brokers
I don't, you know, I don't knowwhat their situation is.
So making sure that that that1099 that you're getting from
your broker for all yourcommissions are all included on
that gross, because the IRS willmatch that out.

Speaker 2 (54:29):
Yeah, so I've gotten audited by the IRS and you know,
obviously let's and let'sanybody who gets audited by the
IRS stressful.
Yeah, You're, you're well, yeah, and you're always going to.
Yeah, I'll take one, Please.
You're always going to um,thank you sir.
Nobody does everything perfect.
So if they come, if they'recoming for you, they're going to
get you.
Yeah, yeah, Jay.

Speaker 4 (54:47):
Edgar Hoover says no man can withstand a thorough
investigation.

Speaker 5 (54:50):
Really, that's, that's true, that's a great
quote.
I never heard that.
Yeah, yeah, yeah.

Speaker 2 (54:53):
Yeah, yeah, yeah, yeah, yeah, yeah, yeah, yeah,
yeah, yeah, yeah, yeah yeah.

Speaker 4 (54:55):
Yeah, yeah, yeah, the federal judge say that.
J Edgar Hoover said it.

Speaker 3 (55:00):
I didn't check right, because right now we got some
comments that wasn't J Edgar.

Speaker 2 (55:06):
Whoa by the way, I'm very happy that the negative
comments have come back a littlebit Not as much as I would like
, but we've had a little.

Speaker 4 (55:13):
Don't worry, you're going to get some today.
We haven't gotten the clips out.
You've done an able job ofoffending multiple.

Speaker 2 (55:22):
Today was lots of large swaths of the population
that we offended several peopleso, but the whole we're talking
about right now.

Speaker 1 (55:28):
I was in the middle of a question there's another
one coming in that just came outactually early and you might
know something about this.
What do you guys know about themonetized installment sale?
I don't know.
Have you guys ever come acrossthat with any?

Speaker 4 (55:40):
With the crypto stuff .

Speaker 1 (55:42):
No, the monetized installment sale is a there's
like these promoters that areputting out there at section 453
.
And it's a.
Basically they're using like adealer of assets and a lot of
real estate transactions todefer the capital gains for like
30 years.
We're using the strategy andthen the IRS put it on their

(56:05):
dirty dozen, like last year.
I think it was last year, theyear before, and then now it's.
They just did a proposedregulation this month and then
next month.
It's gonna be like.
I guess, they do like publiccomment on it or something like
that, but that's a huge one andI can imagine like a lot of I
know a lot of people were doingdeals for real estate deals in

(56:25):
California using that, and thenI would imagine here in Florida
too, because there's a lot ofyeah it's huge.

Speaker 5 (56:32):
I haven't either.
So what was it?

Speaker 4 (56:35):
So monetized installment sale.
It doesn't mean that I don'tknow, the Cadillacs never heard
of it.
No, I'm really like.
I mean.
I mean it must not be true.

Speaker 5 (56:41):
I know it's very likely true, but I mean I may
just know it under another name.

Speaker 2 (56:44):
So we've got the 1030 one right.
So the 1030 one.
You guys To see if we pretendedto know what we're talking
about.
Oh yeah, I heard about that.

Speaker 1 (56:50):
So this one there was a couple of, there's a couple
of promoters of this.
I think it was like two orthree in the through the country
that were handling these andthey would use.
It was like there's a lenderparty, there's a dealer of
assets party, then there's thebuyer and their seller and
basically the seller would,through all of these trans, like
documents that were it'ssimultaneously done in closing

(57:11):
would transfer the propertytemporarily to the dealer of
assets.
That dealer of assets would Toget them past the time to make
sure that they met.

Speaker 5 (57:20):
They complied with the time period in the 1031.

Speaker 1 (57:22):
Yeah, it was the schematic that we're doing to
like basically put it in wherethey were putting enough money
into an escrow account to paythe interest payments over 30
years, to defer that gain, andthen the seller would walk away
with like 95% of their proceedsand then they could use that for
any purpose that they wanted.
And you could do it.
Now you don't have to have realestate, you could sell a

(57:43):
business doing that, or youcould any capital asset Gotcha.
So yeah, the IRS just and forreal estate.

Speaker 5 (57:51):
They knocked that out .

Speaker 1 (57:52):
It was a big one for real estate.
Yeah because sometimes the 1031exchange doesn't always work.
Yeah the time periods are Timeperiods.
It's competitive market.
You got, you know.

Speaker 5 (58:01):
And I put you a competitive disadvantage going
in when you negotiate becausenow you have to disclose on the
way in that.
Hey look, I'm doing 1031exchange.
I got a gun to my head, I'vegot to close this in this time
period and a lot of real estateassets I mean the due diligence
periods- can be.

Speaker 1 (58:14):
I would have thought yeah.

Speaker 5 (58:16):
I wrote a class with this guy on commercial contracts
and why due diligence periodsare so long.
Right, you have these very longdue diligence periods.
So I mean, if you're not readyto go with assets lined up when
you're closing, the ability topotentially close in time or do
the research necessary to closethe asset well is really
precluded.
It's really really limited.
So yeah, that's.

Speaker 1 (58:36):
Surprise, you haven't seen.
Yeah, I mean, I know theappreciation of these, I know
the Delaware the Delaware trust.

Speaker 5 (58:42):
things have become a big deal.
Where they're there they'relike a mutual fund.
I'm just like I'll rete for1031s.
I've seen a lot of people doingthat, but so I hadn't heard.

Speaker 2 (58:49):
that model Can you break down?
So we've had this ongoingargument in our comments on
whether and believe it or not.
I know this is like whether theearth is flat or not, Whether
the earth is flat or not, right,but the renting versus buying,
what are the tax benefits on oneversus the other?

(59:10):
So there's people that continueto say that it's just better to
rent unless there's some majortax benefit that I don't know of
.
I mean, what are the taxbenefits for?

Speaker 5 (59:21):
5,000 a month to rent for, as opposed to a $10,000
mortgage payment.
You remember that one.

Speaker 2 (59:25):
That's the theory yeah, genius yeah.
So how do we explain thedifference to people?

Speaker 1 (59:31):
I mean there's the theory that having your own
primary residents as yourbiggest investment and using it
as an investment vehicle is notthe way to go.
Like the wealthy, yeah.

Speaker 2 (59:43):
Yeah Well, I don't think it should be your only
investment.
But, it definitely should bepart of your portfolio, so maybe
I shouldn't guide you.
Do you consider there to be abenefit to renting tax-wise than
buying?

Speaker 1 (01:00:01):
Well, I'm renting now , but I'm waiting for the market
right now I think the rates areup right now, but I think I'm
waiting for maybe this time nextyear to go back in and buy
something.
I mean I just feel like I'mthrowing my money away.
It's just kind of an emotionalthing for me.

Speaker 4 (01:00:16):
By renting.

Speaker 1 (01:00:16):
You mean by renting?
Yeah, I don't even own this andI'm throwing all this money
away every month.
But you kind of feel I juststraight up Tax points.
That all depends, you know.
And how much mortgage interest,what's your rate?
You know what's your realestate taxes?
Can you get that?
Jack that up enough whereyou're gonna get?
You know you're gonna falloutside of the standard
deduction and I think right nowit's like almost 80% of people

(01:00:37):
right now, since they raised thestandard deduction, are falling
under the standard deduction,so the mortgage interest in the
real estate taxes are not reallybenefiting them.
So every deal is different withthe house.
I'm sorry, go ahead.

Speaker 4 (01:00:51):
No, no, no, no, I was gonna say, I mean I think we,
but you especially get a lot ofpushback on this concept because
of your business, sure.
You know it's like you're an oilcompany and you're telling
people that electric cars arebad.
You know.
It's like, of course you'retelling people that, so you know
.
So you get a lot of that andthen a lot of the comments, and
I get it.
This is part of the bitternessthat people are feeling in the

(01:01:13):
country is like yeah, I knowit's better asshole, but I can't
afford to buy.

Speaker 2 (01:01:17):
Well, get the fucking work.
You know, work harder I meanwork harder, that whole thing.
I don't understand that, right?
I mean, we're in the UnitedStates of America, you could
make as much money as you want,as little as money.
So then say that, right, don'tmake an excuse out of it.
Right, well, I can't because Idon't make enough money.
Are you working hard enough?
Are you doing?
Have you made the rightdecisions?

Speaker 4 (01:01:37):
We've discussed this once before bro People are not.
My old man used to tell me thatpeople are rarely big enough to
like acknowledge, like theirown shortcomings.
It's much easier to be likeit's better to rent now, because
you know the reality is thatfucking rates are too high for
this and that, and it's like noman.
It's not better to you know,tip, buy in large buy in large

(01:01:58):
Unless it's this isolatedincident Right are there
scenarios in which it might bebetter, you know, but as a
general rule, you know, it'sprobably not.
And rates are high.
Now we're used to low rates.
But free money, you know, wasnot sustainable.
I mean, I got in my drawer myold man's mortgage from the
house that I grew up in and itwas like 14% is the rate on it.
Yeah, and it was like in 82 orwhatever, when he bought it 80,

(01:02:20):
82.

Speaker 5 (01:02:20):
It's low for 82.
Yeah, you know, and it was like80 was 16.63, 82, we got a 21%.
Really, yeah, 82 was a bad yearyou know it's like it's just
these things.

Speaker 4 (01:02:30):
You know it's like people are used to historically
low interest rates and they'restill low by, you know,
historical standards.

Speaker 1 (01:02:40):
I think it was like 14, 15%.
Yeah, that's what I'm saying.

Speaker 4 (01:02:43):
Yeah, my old man's mortgage, I have it.

Speaker 5 (01:02:44):
you know the note, I have it, I want it as high as
18%, 18, and, and for sure.

Speaker 4 (01:02:48):
And there was still appreciation 21%.

Speaker 1 (01:02:50):
And this is conventional money and people
are still buying houses too.
People are still buying housestoo.
They were still buying.

Speaker 5 (01:02:53):
This is really the thing, because I think what
people have this.
There's two big problems here.
One victimhood is everybodyloves to be a victim.
Right now, that big victimhoodis what it's all about.
Oh the market.
Look, the reality of it is youonly have one choice that leaves
you in the autonomy To askyourself what the hell you're
gonna do about it when anythinggoes sideways.
Oh the market, what are yougonna do about it?
You can't afford.

(01:03:13):
What are you gonna do about it?
Back to Jesus's point.
But I think that people look atit on a day to day.
Well, what's the payment todayversus the payment tomorrow?
Here's the thing that I alwayslook at when it comes to the
primary residence.
It's the only place I know ofwhere you can make a $250,000
capital gain as an individualand your Uncle Sam are all of
our favorite shared relativesand sitting there at the end of

(01:03:34):
the day saying, hey, I see youmade a little bit of money.
Where's my taste?
It's the only place where UncleSam doesn't come in and look
he's like, oh, you made aquarter of a meal, go ahead,
keep it, don't worry about it.
And so I think the long-termlook at it.

Speaker 4 (01:03:47):
Although, right, that was one of the things Biden was
gonna change.
I'll give you that one.
Yeah, no absolutely.
Go ahead now finish your pointand we'll talk about that.

Speaker 5 (01:03:54):
So the idea that, on a day to day basis, what's gonna
take and leave less money in mypocket.
But, folks, if we think like anemployee, that's how an
employee thinks, paycheck topaycheck.
If we're thinking like theperson who's gonna be living our
life future, us 30, like Iintend to be living my life 30
years from now, it's still gonnabe me.
I'm gonna be stuck withwhatever this guy does today.

(01:04:16):
I'm gonna be stuck with theconsequences of that.
Well, I take a look at what Ibought my property for and I
take a look at what it's worthright now and I know that, Uncle
Sam, not a nickel on all thatmoney and, believe me, I will
sell it.
The second I get close to thathalf million.
I say half million as a marriedcouple, it's a half million
right, I'm out and I'm gonnatake and go into the next one,

(01:04:37):
because why would I lose thatbenefit?
So not roping in all the totalbenefits of the wealth building
capacity, that's there.
I said it before to you and youwere careful to say don't use
the Heal Lock money this way,but to take people taking and
pulling money out other asset oftheir home to take and fund the
starting of businesses andother asset acquisition.

(01:05:00):
I know for me I couldn't affordafter 2008,.
I lost everything and I had astart from scratch.
I mean I lost everything and Ihad a partner with people to get
my first.
I didn't buy my house first, Ibought my first investment
property first and I took andparlayed the income from that.
I live way below my means.

Speaker 2 (01:05:17):
But if you want to, if you want more I know how many
properties you own Am I gonnaget your business out there,
Unless it's in your book?
Is it in your book or no?
I don't know, I don't remember.
Well, whatever, I'm not gonnaget.
Heal's a shitload of properties, the technical term.

Speaker 3 (01:05:29):
Right.

Speaker 2 (01:05:31):
So if you were to be, if you would have been raised
in Miami, you would have justowned one big mansion.

Speaker 4 (01:05:36):
That would have all the With like an eight car
garage.

Speaker 2 (01:05:41):
He would have lived in a $10 million dollar and yeah
so it's a spectacular type.

Speaker 5 (01:05:46):
It's not even over consumption.
It's called conspicuousconsumption, like I need to
consume in such a way that Ishow everybody, and this, I
think, is one of the otherissues with social media that
exists is that everybody's lifeis on display, and so the
jealousy that that generates isa real.
Like you're sitting here sayingI'm working my ass off, why are
they going to the cancer thatis social media man.

Speaker 4 (01:06:07):
It really is.
God bless it so bad.
It really is.

Speaker 5 (01:06:10):
It's got its benefits , but I mean, at the end of the
day, we haven't learned as asociety how to deal with it.

Speaker 2 (01:06:15):
What's new in?

Speaker 5 (01:06:15):
society.

Speaker 3 (01:06:16):
It is.

Speaker 5 (01:06:17):
How to deal with it psychologically in a healthy way
, like how to look at somethingand say, oh well, that's
probably not true, you know,like-.

Speaker 4 (01:06:23):
A few years ago.
They had a new iPhone come outa few years ago and it looked
just like the prior model, youknow, and they had them side by
side and it's like these phoneslook alike.
How will anybody know I'mbetter than them?
Exactly True, it's a thing, ohman.

Speaker 1 (01:06:40):
Well, you know, and to your point, talking about the
phones too, it's like we'repractically renting these phones
too, Cause when you go in andyou turn it in, they take the
last time my daughter's needed aphone or whatever, like oh,
your plan is up.
You know, they're making youpay the least payment within
there and we're going to asociety where everything's being
rented now.
They're trying to get everybodyin these little boxes and these
high rises and you know, who'smaking the money off?

Speaker 4 (01:07:00):
of it.
So it owns the building.
I've never once turned in aprior iPhone.
I literally have in my house astack of old phones going back
to like the original.

Speaker 2 (01:07:10):
I got them here because I don't want no, no, no,
no, I don't want to be shit-.

Speaker 1 (01:07:12):
I'm not gonna be shit For like collecting old
purposes or no, I do it because,listen bro, I just don't.

Speaker 4 (01:07:16):
You know, my phone is like my woman, don't touch it.

Speaker 2 (01:07:20):
Okay, well, I want somebody else putting his hands
on her, I also don't believethat they can't get in and get
all your information and stuff.

Speaker 4 (01:07:26):
Yeah yeah you know, it's like, yeah, it's a good
point, we erased it.
Yeah, sure you did, bro.

Speaker 3 (01:07:32):
Yeah.

Speaker 4 (01:07:33):
You know, so I, you know, I just I have them all.

Speaker 2 (01:07:36):
Yeah, so I mean anything else tax wise that you
can think of man any causeyou're going around podcasts and
giving these tidbits, so I kindof want to see-.

Speaker 1 (01:07:45):
This is what I was thinking about on my way here to
you guys and you might know alot about this the blockchain
and what it's gonna do to realestate, sure and intermediaries,
and fractionalizing.

Speaker 2 (01:08:01):
Yeah, I stopped drinking that fucking Kool-Aid,
to be honest.

Speaker 5 (01:08:02):
Smart contracts, the tokenization is still-.

Speaker 1 (01:08:05):
Tokenization of this stuff.
What's your take on this here?

Speaker 5 (01:08:08):
I love the look.
For me, the big issue really isfor it to do what I think it's
really capable of.
It's gonna take it require theSEC to take and modify how
arduous they make the processfor diversified ownership.
I mean, realistically,tokenization shines best as a

(01:08:28):
reggae plus where you're takingand you're able to go to regular
you know, non-accreditedinvestors because what it does
is lower the cost threshold toentry.
So all of our folks that say,hey, I can't invest in real
estate the regular guy, yeah,now, if I can lower that cost
threshold.
For me, in my mind, as I look atreal estate, that's always been
the biggest hurdle.
The reason why I had to bringpartners in to get started was
the cost threshold, entry.

(01:08:49):
If I could lower that.
Well, it lets me hit on.
One broaden the base of who'sinvesting in real estate.
Two, it allows me to dosomething that I'm super
passionate about, which isexposing younger people to
investing in real estate.
So one of the things I do I'vedone it with hey Sue's before,
as we'll volunteer and go speakat schools, talk about real
estate and so what they do, andI don't have to remember this

(01:09:10):
when I would talk, they'd giveme a gift card for Target or for
Starbucks or something likethat, and say, hey, whichever
kid is most engaged, give themthis gift card.
I'm saying so, wait a second,I'm gonna come up here and talk
about underconsumption, aboutnot wasting your money buying
retail stuff, and you're gonnagive me a way for them to take
it.
I said wouldn't it be amazing ifI could give them, instead of a
$10 gift card, I could givethem $10 on an appreciating

(01:09:33):
asset that's throwing offpositive cash flow.
What would kick this kid's lifeoff as an investor better?
Yeah?

Speaker 2 (01:09:40):
the concept is great.
Listen, the concept is greatand when you're saying it, it
really is.
Seems like the right instrument.
It's just the dirtiness aroundit.

Speaker 3 (01:09:47):
Oh yeah.

Speaker 4 (01:09:48):
I mean right now, it's just as dirty as the
integrity Crypto bros man.

Speaker 2 (01:09:51):
Yeah, they are really just the amount of fucking
weirdos that got into thatbusiness.

Speaker 5 (01:09:56):
It's not even weird.
They are morally free.
Of integrity is, unfortunately,something I've seen a lot and
weird and they dress weird andthey eccentric.
They could dress in fishnetstockings and I don't care.

Speaker 2 (01:10:12):
That's pretty much what it was.
Sadly, I saw it in those cryptoconventions.

Speaker 4 (01:10:15):
Honestly with the dough, I mean on certain people.
There's nothing wrong withfishnet stockings.

Speaker 5 (01:10:19):
I would in fact I think that out there.
I just wanna put that out there.
It should almost be mandated,but not the crypto bros, not the
crypto bros.

Speaker 2 (01:10:25):
Certain people, there were no crypto bros.

Speaker 1 (01:10:26):
You didn't have to say gender.
I like that.
I like where you went with that.

Speaker 2 (01:10:28):
Listen.

Speaker 4 (01:10:30):
It's a thing Self-awareness, baby.

Speaker 5 (01:10:33):
I think that the lack of one of the essential things
to any business and to anycountry is the idea of a shared
integrity, Like the idea that weknow in this country that
there's a reasonable expectationthat if you sign a contract
with somebody, that there's agood likelihood that not only
will that person have to upholdit, they don't.
The law's right there to giveyou a set set of rules that

(01:10:55):
everybody kind of has to complywith.
It's why this country functionsas well as it does in
developing world countries.
That lack of integrity, thatlack of this guy's gonna get a
gun and be able to just take andmake me do whatever he wants.
We don't have that, and withthe people that I dealt with in
the crypto space, that was thebig thing that was lacking is
everybody was out individuallyfor themselves, burning the
bridge they didn't care about.
You know it's shame on you.

(01:11:16):
We pulled one over you, on youkind of thing, and there's
really no meaningful way untilthose folks are out of the space
or other people come in that dohave some integrity to really
look at it.
But there are players in thespace that are making this work
and doing it successfully, soit's a matter of weeding through

(01:11:36):
Kind of like what you have todo.

Speaker 2 (01:11:37):
It's gonna take a while.
It's taking a big step back.
What do you have to do withcontractors?

Speaker 5 (01:11:40):
in Florida.
Yeah, I know, but how manycontractors do you have to go
through to find a new one?

Speaker 2 (01:11:43):
It's taking a huge step back.
So how and well will it recover?
And when the thing is, it'slike anything else.

Speaker 4 (01:11:51):
Anytime you're gonna tell, like the established order
of things, to go and fuckthemselves so brashly, it's
gonna be a problem.

Speaker 3 (01:11:58):
And it's like you know, we have friends we have a
chat.

Speaker 4 (01:12:00):
You know the crypto chat.
That it's like you know some ofthis guys in there, and they're
all great humans, but to tellyou with a straight face that it
can't be regulated.
It's like it can't be regulated.
It's like, listen, bro, yourfriends are all in jail.
So I mean there's plenty ofregulation.
It's just, it's like you know,listen, the notion that fiat
currency is gonna disappear, Ijust don't buy it.
You know the banking system isgonna collapse.

(01:12:23):
It's like guys.

Speaker 2 (01:12:23):
Those are the extremists, like anything else,
extremists and everything.
What was it that you got caughtoff a little while ago?
You're gonna say oh, let's goback to something about Biden.
That Biden did, oh, that therewas.

Speaker 4 (01:12:32):
No, no, no no, no, he was again.
It was something that theadministration had proposed,
which was attacks on unrealizedgains.

Speaker 2 (01:12:39):
Oh, my God.

Speaker 4 (01:12:40):
Okay, and we even discussed now again.
It was a.
It's how all these regulationsstart.
They're like no, it casts avery small net.

Speaker 5 (01:12:49):
Yeah, of course.

Speaker 4 (01:12:50):
So it was something like it had you know, and just
the translation ofoversimplification is that if
your house, okay and I think itdidn't it couldn't be your
primary.
But if you own a property andthe property appreciates, let's
say, by more than $100,000 in agiven year, whatever the number
is, you're taxed on the excessbetween, like I think it was 25

(01:13:10):
grand or 250 grand, and whateverthe number is.
So, just for round numbers, ifyour property increases $10 for
the year, you don't sell it,okay, you get like a free $2.50.
And then you're gonna get taxedon the remaining $7.50.
Now, this didn't apply to everytax payer, it was again, and
that's how it started.

(01:13:31):
It was like no this is only forthe super wealthy and these
ridiculously wealthy properties.
But that would be one of thesemoves that I would agree are
part and parcel of the currentadministration's mindset of the
demonization of wealth and kindof.
You know, it's like if you havea lot of money you must be a
bad person, you know.
And we gotta take it all fromyou.

Speaker 5 (01:13:52):
You gotta pay you know all this money.
That's a narrative that's outthere and I mean it's troubling
to me because people forget.
I mean it's like talking abouthow the rental market was out of
control, whatever.
So I was like, okay, so peopleare putting guns to people's
heads and say you must pay thisrent.
No, somebody's coming in andwillfully offering this much
rent.

Speaker 4 (01:14:09):
It's a bargain no, or willfully paying.
They may not be offering, butthey're agreeing to it.

Speaker 5 (01:14:13):
They're agreeing to pay at least.
I mean not with, again, notwith a gun being held by
anybody's head, the idea thatsomehow now a third party, who
doesn't really have a stake inthis thing, is gonna take and
make a better decision than thetwo parties that are involved.
Look I mean people?

Speaker 4 (01:14:26):
How about during the pandemic, when you couldn't
evict people?
Uh-huh, right you couldn'tevict people.
Well, that just ended not toolong ago.
Well, and what's funny about itis that you hear and here's the
problem Any opinion or positionthat is, let's say, beneficial
to or sourced from the minorityon any issue is more scrutinized

(01:14:50):
.
So it's like you have a lot ofpeople out there that were
renters and, admittedly theywere struggling, and it was a
weird time the government wasshutting down restaurants.
We have some restaurants, it'sa painful business, and so these
are people that they livepaycheck to paycheck Like, by
the way, like a lot of Americansdo Absolutely and then when
they shut down the business,your work, the government

(01:15:12):
doesn't let you work.
So, all of a sudden, the courtshere, and the governor even,
and others, they were like, well, we're gonna prevent evictions.
And then what was happening isthat there's like anything else,
it's the pendulum.
Initially, it's like, hey, Ican't pay my rent because my job
is shut down.

(01:15:33):
And then it turns into how longcan I get away without paying my
rent, and what happens is thatnobody thinks about the property
owner.
And the property owner that haslike a mortgage to pay and
these kinds of things, and it'slike you don't even wanna think
about it Because it's like thenumber of people that own the
properties versus the number ofpeople who rent property is

(01:15:55):
radically different.
So people are like everybodyfeels bad for the renter but
nobody feels bad for the ownerbecause they have money.

Speaker 5 (01:16:02):
Well, I mean it's going a little bit further
because, okay, now that ownercan't pay the debt service, the
debt is held by a bank.
The primary investor in thatbank is your grandmother's
pension fund.
So grandma's pension fund isnow underperforming because of
all this trickle.
It's one of the reasons why Ilove that book Basic Economics,
the idea of the law ofunintended consequences Thomas

(01:16:23):
Sowell is always a big fan ofthat and nailing down the idea
of, like all these great ideaslike rent control, what could be
better than the governmentcontrolling the rent?
Okay, every place it's everhappened.
What's happened?
Rents have become incrediblymore unaffordable.
There's been more slums, moreparking, more buildings torn
down to make parking lots andmore condo conversions.

(01:16:44):
That's what happened everyplace.

Speaker 4 (01:16:46):
No, what's funny is that, you see and again, this is
something Jesus and I argueabout all the time, which is
what I think is the concept ofconsistency.
So we have a friend he'llremain nameless and the guys he
thinks that he is a capitalistRepublican.
That's what the guy thinks, andyet he rents.
And so a few months ago, theguy comes into my office beat

(01:17:10):
red, incensed, and he reallygets upset about everything and
he's like my fucking landlordhad the balls to raise my rent,
blah, blah, blah.
And he's like isn't there somerule now about?

Speaker 3 (01:17:22):
how much?

Speaker 4 (01:17:23):
you can raise the rent and how much notice.
And, by the way, there is sucha rule.
So, as a function of thepandemic now in Florida, if
you're gonna raise a tenant likeyou're only able to raise rent,
I wanna say, don't quote me,but it's random percentage, it's
up to 10%.
So if you're going to raise therent by 10%, you don't have to
give any advanced notice.

(01:17:44):
Basically, you could just say,hey, at renewal, your rent if it
was 1,000, now it's 1,100.
Now if you wanna raise the rentto 1,250, you have to provide I
think it's like 90 days noticeto the tenant and it's like 90
days notice to the tenant ofitself.
If you are aware of the law,right, if you have a lawyer that
you talk to and so okay, youissue the notice, no problem.

(01:18:06):
Like that's one step short ofrent control.
But what's funny is that myoutraged thinking he's
Republican friend.
I'm like, oh wait a minute bro.

Speaker 3 (01:18:16):
So imagine, that you own the apartment, so now you,
no, no.

Speaker 4 (01:18:19):
now you want the government, no fuck.
I don't even use the protectionline.
I'm like you, a guy like youthat aspires to own property,
and you're gonna be a fuckingmillionaire and all this shit
that you tell me every day.
Now you're okay with thegovernment telling you how much
you can charge for your ownplace and when, and then you see
his face kind of like turning.

Speaker 5 (01:18:39):
You see the dissonance.

Speaker 4 (01:18:41):
And it's like you know how and what's funny is
it's like you don't actuallythink of that, like most
people's positions are I had alaw school.

Speaker 2 (01:18:49):
Was it the guy we were texting?

Speaker 4 (01:18:50):
with today.
Yes, yes, and I had a lawschool constitutional law
professor that would say thatwhere you stand depends on where
you sit.
Yeah, okay, so you know, whenthe boot.
You know and I tell Jesus thisall the time we talk about that
Listen, when the government'sboot is on your neck, it doesn't
matter if it's the left boot orthe right boot, they all say

(01:19:12):
Okay.
And so the reality of the matteris that it's like these
concepts like rent control,things like that, these are
contrary.
Like people here in the UnitedStates, they call you a
communist.
In Miami, that's the number oneinsult.
You're a fucking communist.
Meanwhile, your kids are inpublic school, okay.
You use the fucking post office, okay, you, you know, you use
in, like these governmentbenefit programs, et cetera.

(01:19:33):
And it's like guys, thosethings don't exist in Adam
Smith's you know capitalismNobody.
And, by the way, adam Smith'sthe guy that wrote a book called
the Wealth of Nations, rightwhen he's like the father of
capitalism.
He's rolling over in hisfucking grave, thomas Jefferson
as well With the things that wehave, you know.
So it's like it's bullshit.
You know that, like that,that's how people really think
about things.

(01:19:54):
People think about things whenthey're affected.
So, oh, my rent got raised.
Oh, my landlord's an asshole.
It's like, yeah, well, fuck,the interest rates just went
through the fucking roof, buddy.
Yeah, so what I'm paying on mymortgage now went up.
If I have an adjustable ratemortgage.
So guess who you know.
Guess everybody's gotta paymore.

Speaker 5 (01:20:09):
Or if he's on a term loan.
He's got a refi now in 12months and he's on a term loan
and now he's looking at his debtservice.
But I mean, I honestly thinkthat the way that they chose to
do it was really splitting therent control baby about as well
as you could in keeping his freemarket.
And you said 90, it might havebeen 60, I think it's 60 days,
but maybe you're right, maybeit's 90.
But just taking and saying, allright, fine, you know what,

(01:20:30):
there is a spike in this.
Let's give the tenants at leastthe ability to plan out.
Right, great idea For this, it'sreally not a huge burden to the
landlord.
Hey, here's our intent andspell it out.
I thought it was really welldone, rather than sitting here
saying you can't charge morethan.

Speaker 3 (01:20:44):
X.

Speaker 5 (01:20:46):
And I mean, I think that's really like what, what
the nuance needs to be of how dowe take and keep everybody as
empowered as we can withouthaving to come in and intervene
they don't physically have tointervene with that and let's
the problem after the fact saywell, wait a second, here's the
statute.

Speaker 4 (01:21:01):
What did you do?
And it's funny you mentionedearlier the law of unintended
consequences on all these kindsof changes.
I'll give you guys an exampleof a great one.
So last week at the Frickmeeting we had a workshop after
about preparing the or takingcomment, taking suggestions.
Many stakeholders came in onthe preparation of what's gonna

(01:21:23):
be the promulgated affidavit forall Florida purchasers to sign
regarding the Conveyances toForeign Entities Act.
So as of July one in Florida, ifyou are buying real property I
don't care if you're, you know,corn fed Iowa farm boy you're
buying property in FloridaYou're gonna sign an affidavit

(01:21:43):
that says that you are not aforeign principal as defined
under the statute Okay.
And if you are a foreignprincipal and for some reason
the statute doesn't apply to you, right, like, let's say, you're
not buying farmland and you'renot buying property that's
within 10 miles of criticalinfrastructure, you are also
going to sign the affidavitsaying you know, and it's little
boxes, okay, it's like I'm nota foreign principal.

(01:22:05):
Statute doesn't apply, I am.
But here's the exception I'mbuying, you know, this property
that doesn't qualify, right.
So we're going through thisform because the statute put it
on the Florida real estatecommission to come up with this
affidavit, okay.
So it was fascinating to watchbecause you know, all the major
title insurance underwriterswere there with their proposed

(01:22:26):
form, okay, major law firms werethere with their proposed forms
and you know everybody comeswith like their theories on it.
And so one big one, one bigpush I literally just got an
email on it today from a lawyerat a big underwriter is that
cash buyers are pissed off thatthey have to sign this affidavit

(01:22:46):
because cash buyers ordinarilyonly need to sign a closing
statement.
You can even do it like scannedcopy will do, but now you're
having to have a notary.
Oh, wow, right, for theaffidavit, you have to like have
, you know, a document notarized.
You got to arrange for a notaryand there's this expense and
the whole thing.
And and some of these peoplewere proposing that we adopt the

(01:23:09):
ability to sign an attestationright, which is unsworn okay, so
you don't need, you don't needthe notary, okay, and so that's
a lot of these people arepushing for this.
But here's the law of unintendedconsequences is that this lady
gets up and you could tell shewas very well prepared.
I mean, this lady came, shejust looked to the nines.

(01:23:31):
Okay, she comes up to thepodium and she says you know, hi
, my name is so-and-so and I'mfrom Carlisle in DC, you know,
and they had come down fromWashington DC and Carlisle's a
big reed, like a big investmentfirm, and they were saying that,
like the way, the affidavits,everyone's form of affidavit,
would make it impossible for biginvestment firms and like funds

(01:23:55):
basically to invest in FloridaBecause many of the limited
partners in the funds could bethese foreign principles okay,
and the statute hinges on theamount of control that the
foreign principle exercises overan LLC purchaser right or an
entity purchaser.
So a lot of people, especiallyin Miami, some agents again will

(01:24:18):
not be identified, but they'relike oh yeah, richard bro, I
have an idea.
Man, why don't we put it undera company Scarface bought for?

Speaker 3 (01:24:26):
me Can we buy it under a company?

Speaker 4 (01:24:27):
And I was like, pfft, you figured it out, my man.

Speaker 3 (01:24:32):
No, no, no, no, you did it.

Speaker 4 (01:24:33):
You sitting right here in my office today.
You came up with the fuckingsolution, the workaround.
None of the 300 lawyers thatworked for the governor, no one
in legislation, no one staffed,none of the people thought about
that.
You found the workaround and hewas like, are you being
sarcastic?
And I was like, yeah, I'm beingfucking sarcastic.

(01:24:55):
So even if you don't fix theproblem by buying under a
company and the statute saysit's like, by the way, if you
buy under a company, if you havemore than 5%, then you exercise
control.
5%.
Okay, so you exercise control.
And so what happened was thatthere was a different part of
the Florida statutes that wasalso implicated with these
definitions of controllinginterest, which was not defined

(01:25:19):
in chapter 600, which was theFlorida statute.
And these people did the worklike this REIT had done the work
.
The fund did the work of saying, hey, here's how you're gonna
get there.

Speaker 2 (01:25:28):
They did a favor for a lot of other funds.

Speaker 4 (01:25:30):
No, no, no let me tell you something they did a
favor to, in my view to thegovernor to the state because
and I spoke up I was like wehave to make this work.
We're gonna have to fit this,because there's no way that the
governor and the legislature'sintent with this statute was to
make it so that equity funds andhedge funds and this and that

(01:25:52):
can invest in the state ofFlorida.
There's no way.
That was the plan.
And everybody on the commissionwas like yeah, no, we agree,
absolutely not the plan.
And so we sat there with thesepeople after drafting the lines
this, our lawyer, the Fricklawyer, the lawyer for the
Carlisle group I mean it wasfascinating.
And I went up to her after and Isaid man, thank you, you guys
really, because I want you toknow You're out of the fire yeah

(01:26:13):
, by the way the oppositionwould have taken it, would have
rammed it right up, right up thegovernor's by saying look, look
what you did Like.
You've prevented all thisinvestment and that's absolutely
not the plan.
So luckily there was a solutionand it's not gonna be an issue.
But you gotta be careful, man,I mean you, you know.

Speaker 5 (01:26:31):
I mean, how many people missed that right For it
to even get?

Speaker 4 (01:26:34):
that far.

Speaker 5 (01:26:35):
Everybody See that's the kind of thing that people
missed, that's gonna scare thehell out of you because, like,
when it's something that there'sso much capital tied up in that
so you have so many eyes on it,what when it's not something
like that, when there's thatmany eyes on it?
And there's all these rentcontrol again being a great
example of you know these greathigh ideals and what actually
happened.

Speaker 4 (01:26:53):
Because there isn't really like a, you know, like a
landlord lobby person.

Speaker 5 (01:26:56):
Yeah, it's not like that, you know, like it's not a
cohesive industry.
We don't meet us every secondThursday.
Yeah, yeah, yeah.

Speaker 2 (01:27:01):
Yeah, yeah, Let me ask you a question.
So you were, you were a CPA inNew York for a bit and then came
over here.
Yeah, we were talking about itlast week.
How is it different to dobusiness here in Miami versus
versus New York?
I mean what?

Speaker 1 (01:27:15):
what he's talking about Florida, you know the
first, yeah, so I mean it'sprobably the same story.

Speaker 2 (01:27:22):
Oh well, yeah, he's up there.
You know, it's not Miami.

Speaker 1 (01:27:24):
Yeah, you're right, you call somebody and say you're
gonna meet him at nine o'clock,right, you know, tuesday I'll
be there.
And you know, in Florida it'slike even contractors or
whatever you know it's like,okay, it's 11 o'clock.
You know, I told the guy Ithought he was gonna be at nine
o'clock.
They didn't call yet they showup at 1230 like oh, we're here
and I'm like you know, that waslike that took a little while to
get used to.
Yeah, then you get, then youget used to it.

(01:27:45):
But I think that you hadtouched upon it too is like
contracts too.
It's like a deal is not a dealuntil you get to the closing
table.

Speaker 2 (01:27:51):
Yeah.

Speaker 1 (01:27:52):
Because anything is off.
You know it's like, it's likethey.
It's a different mindset.
I think here in Florida, wherecontracts and deals are a little
different story than it is.
Yeah, we're all like it's likeit's like you know you have like
not to get to.
You get the George Lord's likereally you know making sure they

(01:28:14):
got their coming over yeah.
Yeah.

Speaker 4 (01:28:16):
Covered up as opposed to all the other players who
are not nearly as careful.
So so I don't know who you'reinsulting, maybe both.
Well done, he's managed toinsult you.
Call it an upside amount, sothe Jews are too careful.

Speaker 3 (01:28:32):
No one can be offended.

Speaker 1 (01:28:34):
But even buying something I'm not even going to
be listing it, just like a lotof you know a lot of the stuff
that you know.
It's just, it's different.
It's just different, yeah.
So I mean, I don't know, do youagree with that 100%?

Speaker 4 (01:28:43):
The level of sophistication, I mean listen
every time, and I mean it evento big law here, even big law
here in Miami, like I had some,and I do mean the pleasure of
closing some deals for a bankclient of mine in the past, in
the past year, past 12 months,and these were very interesting
deals, high value deals,sophisticated parties and man

(01:29:05):
the big firm lawyers in otherstates Philadelphia, new York
that I was dealing with.
I mean what I learned just fromdealing with those guys via
email the quality of theirdocuments.
Like you know, you get thedocuments in Word and for us,
the practice of law,incidentally, is the only
business where they rewardplagiarism.
Ok, so it's like please don'treinvent the wheel.

Speaker 3 (01:29:28):
Yeah.

Speaker 4 (01:29:28):
OK, like if you walk into your lawyer's office and
he's got like a blank screen andhe's starting to type a
document like run, yeah, ok,like it's been done before.
Ok, you can modify, you canmake improvements, but by and
large, you know, I don't knowwho the first guy was the scribe
that wrote like these formsthat we use.
But, man, the quality of thedocuments and their way, the

(01:29:49):
professionalism, I mean it'sjust.
I mean I'm sorry if you're abig firm lawyer in Miami, there
are very good ones, there aremany, many good lawyers in Miami
.
But, man, you know, it's justlike it just by the way same
thing with same thing with realestate agents.
By the way, you go up to themiddle estate and the people
that come to see the quality of100% yeah, and they're their
level of devotion and commitmentto the profession.

(01:30:10):
Yeah, sure.

Speaker 5 (01:30:11):
It's just different.

Speaker 4 (01:30:12):
Yeah, I mean they're, yeah, they're professionals,
you know, and so yeah, I mean Idefinitely would agree with that
.

Speaker 2 (01:30:19):
I don't even want any questions.
Wrapping up.

Speaker 5 (01:30:22):
I think maybe I'd ask the question, you know, is
there, is there anything?
Because I mean, as a businessowner, this is one I always like
to ask in my podcast is thereanything you've learned in
business?
That was kind of like, as youlook back, it's like that was a
big one, like something that youwant to share with the people
that are listening and say youknow, if you're in business,
what would be some big takeawayfor you?

Speaker 2 (01:30:39):
Or if you're one of your clients, that you've seen a
mistake they've made, oranything like that.

Speaker 1 (01:30:44):
You know, I would say I had a business where I had a
partner.
Maybe you could don't getpartners Not don't get a partner
, but just make sure becauseit's like a marriage.
That was one of the that wasone of the worst things is
untaggling.
That situation was probably oneof the worst things that I had
to go through and you know it'slike a divorce.
You know many people could talkabout that, so I think that was

(01:31:04):
probably one of the one of thebig things that take away that.
I just remember that was a verynasty situation, yeah.

Speaker 5 (01:31:12):
So how to have the right go with the right people.

Speaker 1 (01:31:14):
You know I was telling people to come in.
I'm like you know, and it's youknow, they want to.
Everything's all great and allokay.
Do, are you going in?

Speaker 2 (01:31:22):
You know, I had a buddy of mine like last week,
whatever just I'm not going tosay the business, whatever, but
he was, he was looking for apartner right In a particular
business and you know, he didn'teven know the part.
He was in a partner withsomeone.
He didn't even know the partner.
Like never done any businesswith a partner.
I'm like, are you fuckinginsane?
Like dude, like you're going,it is a marriage.

(01:31:46):
It's like that's like meetingsomebody and then just just
getting married and starting tolive together.
In the whole situation, I mean,if you're going to get a
partner, I mean it better besomebody that I mean you've done
business with.
Things have gone right andthings have gone wrong before.
You know, I also people I meanlike these, these, these two
gentlemen here, I mean I metthem in business, we became
friends through business, notthe other way around, and I

(01:32:06):
think that's what happens a lot.
I think people go the other wayaround.
Well, they're a really goodfriend, so they're probably
going to be good at business.

Speaker 5 (01:32:12):
I don't know, not necessarily good resume.

Speaker 2 (01:32:13):
That's where friendships get, get, get ruined
.
You know what I'm saying.
Like, like, at the end of theday, we've gone through good,
bad.
I mean, you know every argumentwe could possibly have we've
had, you know that type of stuff.
So not, not, not as muchCadillac, but you know, I just
marvel at your own.

Speaker 5 (01:32:29):
I have.
I have been a fly on the wallfor a few of those, and it's,
it's breathtaking.

Speaker 2 (01:32:33):
But yeah, you, you know when, when picking a
partner, if I'm going to giveyou know any, any advice and
I've seen you know a lot offriends go in the wrong
direction with that yeah, justmake sure that you know you've
gone through some stuff.
There's ways to do businesswithout going into business.

Speaker 4 (01:32:46):
Yeah, my, my old man, was not a fan of partnerships,
right.

Speaker 2 (01:32:49):
But he was a tough person.

Speaker 4 (01:32:50):
Yeah, he would say that he has to be a guyless.
Who bought you which?
Translates to he's like I haveto be the rooster of my yard
yeah.

Speaker 2 (01:32:59):
He must have been a very difficult guy to be a
partner there was one there wasone crazy guy to do a business
with him.

Speaker 1 (01:33:03):
Yeah, I just I just had a guy come in.
He had a restaurant with hisbrother-in-law and now they
don't even talk for like I don'tknow a few years now and
they're having to deal with theemployee retention credit.
Yeah, so one of the guys gotthe checks, so now they're
trying to figure out what to dowith that and it's like several
hundred thousand dollars andthat's a mess.

Speaker 4 (01:33:22):
I hope they did it right, because the IRS is
busting people's balls on that.

Speaker 1 (01:33:26):
They don't like that game.
Yeah, because anytime there'sfree money well, they had all
these these guys just callingyou know, these just set up shop
and they had, you know,telephone anybody that you can
and you're telling them you'regoing to qualify for this and
then most people don't evenunderstand, like, oh, this is
free money, you know.
And then you have to go throughthe metrics to make sure that
you qualify for that I just went.

Speaker 4 (01:33:46):
I just went through it the other day, where you know
we get.
I don't want to say we got acall, but it was sort of that
way.
And you know, this client ofmine says to me he goes hey, you
know, I want to do this, youknow the government's giving
away money and so you know Iwant to get, I want to be on the
free money train.
And I said, okay, sure, let's.
I think it's a horrible idea,but let's go through it, and so

(01:34:08):
so he, they connect me to theERC people.
and the lady starts, like youknow, she starts with the sales
pitch and immediately I wastrying to make it clear.
I'm like hey, like, I know thedifference between what you're
saying and the truth.
So forget the sales pitch,let's talk about, like, what my
client's going to have to show.
And then she was like well, weoffer two services.
The first is where, if you canprovide all of this shit, we'll

(01:34:30):
prepare, like the package andwe'll stand by it.
Okay, like, well, what it meansis that when the IRS comes
calling, they'll be there tolike advocate for you.
Okay.
And then it was like or there'sthe other package where you know
, depending on the narrativethat you're able to like
generate, that you know we'llprepare the application for you,
but we will not.

(01:34:51):
Like you know, you're on yourown after that.
And so I ended up concludingthat neither was acceptable, you
know.
And then, like, of course, theclient gets pissed and he's like
I don't understand you knowwhat the position I go no, no,
let's fucking go through it.
You have to be able to showthis.
Do you have?
Can you show this here's likeand of course, this is a guy
who's at this level and theoperations people are at this
level and when he talks to them,they're yes, people.

(01:35:13):
They're like, oh yeah,absolutely this and that, and
then so we bring these people inand then I have to do what
makes people not like me.
I engage in like the painfullysimple questions you know, and
then like when you oh, oh, oh,you know.
And so it's like listen, howbad do you want the free money
Lose, sleep bad, because I meanI don't want anything that bad
you know.
And so it's like everythingelse, man.

Speaker 2 (01:35:34):
Yeah, we went through the questions here and we don't
qualify.

Speaker 4 (01:35:38):
Right, right, you had to have like a loss in income.
Yeah, it's like man, we werecrushing it, yeah.
That was my one thing, it's like, hey, we had to show like a
loss, we crushed it.
And then he was like, yeah, butwe could have crushed it more.
I'm like, but that's not theway it works.
Can you imagine, judge?
He said he could have crushedit more.
It's like like nobody likesthat argument, dude, like the

(01:36:02):
regular people there.
They're like you hear thisasshole?
He could have crushed it more.
It's like it's how much morecould he have crushed it?

Speaker 5 (01:36:07):
Yeah, let's go ahead and quantify this.

Speaker 2 (01:36:11):
Man, it's crazy, All right guys, we got to wrap it up
, your book, yeah, yeah.

Speaker 1 (01:36:18):
So I have a couple of ebooks out there.
You just go to my Instagrampage and hit the link tree there
you could.
Instagram pages is a seeing.
Seeing beyond the numbers.
Seeing beyond the numbers, yeah.

Speaker 2 (01:36:30):
Yeah, we'll put it on the description.
And thanks, man, thanks, thanksfor coming.

Speaker 4 (01:36:33):
Thanks for having me.
That was great, hi, I had youfind this guy Ariel found Ariel
found him.

Speaker 1 (01:36:37):
We got to see him, got it.
Man, I'm really impressed.
I thought you guys knew eachother.

Speaker 4 (01:36:41):
No, oh, that's why he's been busting my balls about
not getting interviewees.
I'm sorry, but I'm not good.
I don't have someone to call,call for me, so is this
something I know he?
Did.

Speaker 3 (01:36:50):
I'll find the other.
The other two.
You did a bang up job, bro, so.

Speaker 4 (01:36:54):
Ariel found them and Ariel called them.
Great job bro.

Speaker 2 (01:36:57):
No, no, yeah, you're knocking it out.
I'm the interviewer.
You fucking Listen.
Well, have somebody.

Speaker 4 (01:37:01):
have somebody call somebody and get somebody in
here, get your head out of yourass and let's get some
interviewees.
Delegation yeah, the delegate.
Fine, you know what?

Speaker 2 (01:37:09):
Delegate, you get somebody yeah.
So yeah, man cool.
So you're going to have this ona continued basis on yeah, man,
we've been pretty consistent,so we got a couple of interviews
coming up that I lined upPretty interesting.

Speaker 4 (01:37:23):
Then I lined up by delegation.

Speaker 2 (01:37:25):
No, no, these are these are not.

Speaker 4 (01:37:26):
Even these are non delegated ones.

Speaker 2 (01:37:28):
These are non delegated ones.
So so yeah, we've done a coupleof interwe, we did what we did
one interview before.
This will be our second toRight yeah, business wise, yeah,
by the way.

Speaker 4 (01:37:41):
Our good friend, I just want to read this out loud.
Okay, we get in on this.
Our good friend just send us atext that says Breaking video
leak Arrested child traffickeradmits to boarding school used
as a front for organ harvestingin Ukraine.

Speaker 3 (01:38:01):
Don't send the money.
Yeah, yeah.

Speaker 4 (01:38:04):
That's your guy, bro, that's your guy.

Speaker 2 (01:38:05):
Oh my God, you started that All right, all
right, guys, cool, thank you.
So the book will put.
It will put all his informationup, thank you.
Thank you for coming, Josh,josh's book, yeah, for sure.
Yeah, yeah, josh, if you couldhold your book like I can do the
my Vanna.

Speaker 5 (01:38:19):
White.

Speaker 2 (01:38:21):
I study that a white privilege Vanna.

Speaker 5 (01:38:23):
White privilege Wait, I noticed that?

Speaker 4 (01:38:26):
Did you see who's in the forward?
No, can we open it up?

Speaker 5 (01:38:33):
Wow, the ball busting begins.

Speaker 4 (01:38:34):
Yeah, no let's open it up, because I didn't do my
job to promote the book, but but.

Speaker 3 (01:38:40):
I'm on right there, okay, fine.

Speaker 2 (01:38:44):
Fuck, well, fine, but , dude, we had to chase you
around for three weeks.
A powerful quote I had tolisten, I had to.
I had to chase you around forthree weeks to be able to
promote it.
Yeah Well, that's it.

Speaker 4 (01:38:53):
Good things come to those who wait, All right guys,
thank you.

Speaker 2 (01:38:58):
What camera am I looking into?
I don't even know we're.
It's only one right, all right,thank you.

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Episode 35: Exploring Tax Benefits in Real Estate Investing with an accountant

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