September 29, 2025 • 39 mins
In this episode, Zach and Patrick sit down with KC Chohan, founder of Together CFO, to talk about one of the most overlooked parts of real estate investing—tax strategy. KC has helped investors at every level save money, protect their assets, and build long-term wealth using strategies most landlords don’t even realize exist.
We dive into KC’s journey, the most common mistakes landlords make, and practical tax-saving moves for both new and experienced investors. From asset protection to simple strategies that can save thousands, KC shares real-world examples and actionable advice you can put to use right away.
If you’ve ever wondered when to start working with a tax professional, how to keep more of your rental income, or what hidden tax tricks most landlords miss, this episode is packed with insights you won’t want to miss.
If you want to schedule time with his team or want to learn more about KC, visit him ---> Here
Learn More https://innago.com/podcast/
Sponsors:
Innago is a free, online property management software designed for landlords, particularly those managing small to medium-sized portfolios. It offers a range of features to simplify tasks like rent collection, lease management, maintenance requests, and tenant screening.
Ledgre is an All-in-One Accounting Software Built for Rentals. Organize property transactions, track expenses, and automate rental accounting with simple software focused on your industry.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_01 (00:03):
What's going on, everybody?
Welcome to season two of theRent Ish Podcast.
I'm Zach and I'm here with myco-host Patrick.
SPEAKER_00 (00:09):
We're two rookies chasing the dream of real estate
investing.
In this podcast, we'll talkabout property management, wild
stories, and everything inbetween.
We don't know it yet.
SPEAKER_01 (00:18):
But that's the point.
We're learning as we go, justlike you.
We'll bring in the experts toeducate us and inform us and
we'll figure it out together.
So let's laugh, learn, and diveinto real estate side by side.
Patrick, this is the newfrontier of the Rent Ish Podcast
because this is all digital.
We've given up, we've given upon being face to face at this
point.
We got tired of each other'scompany, so now we're all Zoom.
(00:40):
We're in the 21st century.
So high tech.
High tech, high tech, high tech.
Yeah.
So the listeners out there,thank you for dropping by for
this episode of the RentishPodcast.
You know all the places that youcan typically follow us, social
media at the Rentish Pod.
You can email questions at theRentish Pod.com.
And there's plenty of otherplaces to find us, like us, and
subscribe on your podcast, feetof choice.
(01:01):
But there's no sense of reallykind of dilly-dallying around.
Usually I would ask Patrick howhis day is going, but I don't
really care right now.
We don't care, yeah.
Yeah, no.
Because we've got much moreimportant things to do right now
because we've got a very, very,very special guest.
We are joined today by CaseyChohan.
And in this segment, we're goingto be talking about a smart tax
planning, asset protection, andhow it can help landlords and
(01:21):
real estate investors keep moremoney in their pockets and
protect what they've built.
Founder of Together CFO, Caseyis known for helping real estate
investors and business ownerssave money on taxes and protect
their wealth.
He's all about showing peoplestrategies that most of us don't
even realize exist yet.
And he's worked with investorsat every stage of their journey.
Casey, we're so excited to haveyou on the Rentish.
(01:41):
Welcome to the show.
SPEAKER_03 (01:42):
All right, let's go, boys.
I love the energy already.
SPEAKER_01 (01:45):
Yeah.
We're trying to keep it up.
How many cups of coffee have youthat can we do or we on the
room?
SPEAKER_03 (01:50):
I'm on like third one and it's about 12 o'clock,
so I'm doing all right.
SPEAKER_01 (01:53):
Okay, you fit right in that.
Yeah, knowing Patrick, he'sprobably on the floor.
SPEAKER_03 (01:59):
Like I'm kind of addicted to Nespresso right now.
SPEAKER_00 (02:02):
Yeah.
We just got in the office, wegot a new uh Nespresso machine
like a month ago, and I've beenhammering that because we we had
like the crappy cure eggsbefore, but now it's like water,
muddy water, it's disgusting.
SPEAKER_01 (02:14):
Yeah.
Welcome to the coffee cast.
We're gonna talk about uh thedifferences between no, no, no,
no.
Casey, we brought you on boardbecause you're an expert in your
field and uh we wanted to hearabout all the things that you
have to tell us about uhTogether CFO, along with uh tax
planning and asset protection.
So without belaboring the pointat all, I mean tell us a little
bit about you.
(02:34):
But you know, how did you getinto the industry?
What's your passion?
What makes you tick here?
SPEAKER_03 (02:38):
Well, I stumbled into tax savings because as you
can hear, I'm not American.
I'm born and raised in Englandand I have no real business over
here doing tax stuff, but I fellinto it and I doubled down on
it, and now I own my own smalllittle niche within a sub-niche.
So my background is inaccounting and finance.
(03:00):
I was working for a big Fortune500 company for eight plus
years.
I did four in Europe and then Itransferred to America, did
another four here until I uh gotmy green card and started my own
company.
I didn't really like corporateAmerica when I landed here, but
um, it is what it is.
You gotta pay your dues and youmove on, right?
So uh I started my own businessas an outsourced fractional CFO,
(03:25):
as the name suggests, togetherCFO.
And then what happened was inthe first year we we stumbled
into a huge success with aclient.
We took him from five million ayear to 120 million a year, and
that created a huge tax problemfor him, or it was about to if
we didn't fix it.
So he then kind of begrudginglypushed me into figuring out how
(03:50):
to reduce his taxes at that highlevel, which is very different
to fixing a tax problem at amillion dollars a year or like a
couple of million, like 120million is a lot of money,
right?
Right, so the loopholes thatmost people use were not going
to be applicable at that hugelevel, right?
So when we look at real estate,so many great loopholes you can
(04:12):
use, you know, uh bonusdepreciation, cost segregations,
hub zones, there's loads ofthem, right?
And uh, you could be aprofessional real estate person.
Obviously, all of these gowithout saying.
I'm sure the listeners alreadyknow a lot about all of them.
But when you get into likemillions of dollars and we're
talking multi-seven,multi-eight, multi-nine figures,
(04:35):
you need structures to go on topof the loopholes.
Like everyone should be usingloopholes, regardless of if
you're starting day one or ifyou're just entering year 10.
Everyone should maximize all ofthose because that's what the
government is incentivizing usto do.
They're saying take this actionand we will give you a credit
(04:56):
for it, whether it's as simpleas going to buy a car or an
electric car because you get anextra seven and a half thousand
dollars off that, right?
So they're saying do thisactivity and we will reward you
with a credit.
Okay, great.
But they're gonna cap thatcredit, they're not gonna give
you an endless amount of credit.
And a great example of this isretirement accounts.
(05:17):
You can only put tens ofthousands into these retirement
accounts, but if you're making acouple of million dollars, tens
of thousands just aren't gonnacut it.
You need something more robust,something bigger than just
ordinary loopholes, and that'sreally where we come in.
So we take the structures andthe entities that are used by
(05:38):
family officers and the elitebillionaires, and we simplify it
so that it can be used by themodern day multi-seven,
multi-eight figure businessowner.
And then that has a few knock-onconsequences.
One, you significantly reduceyour tax burden, it's asset
protection, it's legacycreation, and there's often a
(05:59):
bit of philanthropy thrown inthere just for the sprinkle on
top.
SPEAKER_00 (06:03):
So, Casey, I don't know if I maybe like
misunderstood, but it soundedlike when you started the
company, which it this is allsuper interesting, but when you
started the company, you hadmaybe like different ideas for
what the company was gonna be.
And then because of the client,like this lot huge client, you
kind of like totally had toshift gears and and kind of like
(06:24):
like how what what was thatlike?
And like, was that kind of ajarring experience for you?
Is it was it interesting to you?
Was it kind of scary, likehaving to kind of go down the
top?
SPEAKER_03 (06:35):
So scary because, like, in my mind, what's
happened is I've gone from areally good, comfortable
corporate job that I've been atfor eight years, making
multi-six figures, living a goodlife, right?
Moved to LA, the sun's shining,I'm in a shorts and t-shirt,
there's lots of beautiful womenhere, and I'm a single guy, so
(06:55):
you know you can figure out therest yourself.
Um, and then it's like, holyshit, I'm I'm not having that
comfort anymore, and I'mstarting my own business, and
I've kind of backed myself, andit's like, all right, now it's
go time because if I don't getany clients, I don't make any
money.
Now that's on me, right?
(07:16):
And again, I mitigated that.
I didn't just split the switchand go.
I knew that was coming down thepipeline, so I took steps along
the way to make sure it was assmooth as possible.
So I had a handful of clientsbefore I put my notice in.
So I knew I would make X amountof money regardless of what,
unless I lost some of thoseclients.
What actually ended up happeningis one of them took off and it
(07:39):
went crazy.
And yeah, I pivoted becauseyou've got to be flexible,
right?
You've got to be able to go withthe ebbs and flows of a business
because it's not always gonna bea smooth, straight line.
And in fact, none of them everare a smooth, straight line,
right?
So there's always gonna bemassive ups and massive downs,
but you're totally right.
We started off doing fractionalCFO services, but then once we
(08:03):
figured out, hey, we saved him,let me close the loop on that.
We saved him about 12 milliondollars in that first year on
taxes by creating the structuresthat we're talking about.
Wow.
So for me, it was like, oh, holyshit, if we can save this guy
this much money, there's plentyof other people out there that
have we can use similarstructures for and have the same
(08:24):
level of savings.
Why should the family officesand the elite billionaires get
to use all of this?
But the people that need it themost, they're just kind of
priced out of it because theycan't afford a five million
dollar a year family office.
Right.
So we kind of took that subsetof hey, maybe you don't need all
12 people of the family office,maybe you just need us.
(08:45):
So we can significantly cut downon that five million dollar
overhead and give you one pieceof the family office that is
probably the most valuable toyou right now, and then you can
add the other pieces in later asyou go.
Very cool.
SPEAKER_00 (09:00):
Yeah, it makes a lot of sense.
And so, in terms of because I Iam speaking for Zach here, I I'm
I'm not 100% I'm accurate onthis.
I'm not any sort of tax expert.
No, Zach.
Okay.
Yeah, we're uncharted.
Yeah, I I you know we'll use theturbo tax at the end of the year
(09:21):
and call it a day sort of thing.
Um but um how how does like withworking with several different
clients is a lot of the sort oflike the tax breaks and these
sort of incentives and differentloopholes, as you've said, does
that shift radically from clientto client based on their
business?
Or is it kind of like do youhave like a set sort of
(09:42):
procedure on how to how to helppeople out with this kind of
thing?
SPEAKER_03 (09:45):
Yeah, so let's break it down into two different
levels, right?
Okay, so the loophole level,which everyone should be using
as much as possible, is gonnachange all the time uh based on
administration that's in, howlong they're in, and what they
want to incentivize in theeconomy, right?
Because their global macropicture is hey, we need to boost
(10:07):
these three areas.
What can we do to boost that?
And use EV cars as a primeexample of that.
Okay, so since Tesla kind ofkicked off, they've been doing
this$7,500 credit for electriccars, right?
But if you want to go in anelectric car, you're gonna get
an additional seven and a halfthousand dollars.
So if you've got two cars thatyou're looking at, let's just
(10:29):
call one of them uh let's use acamry, right?
Let's use a camry versus a Priusbecause they're both Toyotas.
One can be electric, one can bepetrol or gas, as you guys say.
And then if I'm gonna get sevenand a half thousand more off
this one, I'm gonna do that.
That's gonna incentivize me totake the action that they want,
go buy a car, or maybe if Icouldn't quite afford a car, but
(10:51):
now I can because it's seven anda half thousand dollars cheaper,
maybe I'll go and buy a car.
So now you get more people doingthat action that you want to
stimulate the economy in the waythat you want it.
So that's like a governmentthing, and then on top of that
is more of a longer standinglegacy thing, which is
structures.
(11:11):
Because when it comes down toit, the bottom line is you are
only as good as the team aroundyou, which you can apply to real
estate, property management,software, whatever company you
want.
Because if you're only relyingon one person's expertise, like
a CPA as an example, then youcould be leaving so much money
on the table if they don't knowwhat they're doing.
(11:34):
So this is why 92% of peopleoverpay on their taxes because
they are too reliant on oneperson.
And then the deeper question ispeople get it so twisted.
The CPA's job is not to save youmoney on taxes.
Look at your agreement with yourCPA.
It doesn't say that anywhere.
(11:56):
It says that their job is tomake sure you file and pay your
taxes.
People just automatically assumethat, hey, just because you're
filing it and you're telling mehow much my quarterly estimate
is and you're making sure I payit, and how much to pay to who,
because there's like fivemillion agencies you've got to
pay around here, that you'realso helping me save money on
taxes.
That's not true.
A tax strategist will help yousave money on taxes because you
(12:20):
are paying them a percentage ofwhatever they save you versus a
CPA who's gonna get a flat feeregardless of if he saves you
$100 or$10 million.
SPEAKER_00 (12:32):
Interesting.
I never even thought about that.
I I guess I'm sort of thinking,like, oh, you pay the CPA, their
job is to help you, but I guessthat makes sense.
A tax strategist is what youwant to be able to save the
money.
SPEAKER_03 (12:43):
Well, think about it, right?
So if you speak to your CPA,let's say once or twice a year,
like the average person, andyou're flapping around at the
end of the year to say, hey,what else can we take to write
off?
I don't want to pay this much intaxes.
He doesn't really care at thatpoint.
He's like, Well, I've gotanother 500 clients here,
another thousand clients I haveto do the exact same thing for.
(13:05):
And me taking five more hours tofigure out what loopholes we can
jump through for you, orlearning and going uh across the
country to do a seminar oractually reading some of these
stupidly boring books behind mein terms of figuring out what is
available, it's not gonna happenbecause he is not getting paid
to do that.
And unless you're consulting himat$500,000 an hour and paying
(13:28):
him to do that, it's not in hisbest interest to grow his
business by saving you money ontaxes.
Just keep filing, send me areferral if you can, and I'll
talk to you once or twice ayear.
That's kind of the mindset ofthe CPA.
SPEAKER_01 (13:43):
$500,000 an hour sounds like a reasonable rate
for a CPA, I'd say.
There you go.
Okay, that was I heard thatnumber I was like, that was my
rate I was giving you.
Um well, you might have kind ofanswered it with like kind of
getting off on the right footwith figuring out where you need
to go in terms of your ownportfolio or whatever, but like
(14:06):
what's that most common mistakethat you see so many people make
with with their taxes at thevery like at the jump?
Like, is that the common is thatthe most common thing is that
people just don't don't knowwhere to go from the jump?
They don't know where which wayto handle their money.
SPEAKER_03 (14:19):
There's a couple of things that most people don't
even realize.
So Pat's a prime example, right?
Because you're very honest.
You're like, well, I didn't eventhink of that.
Most people don't, and it's likestep one is is your CPA working
for you, or do you need to gofind a team that is working for
you?
Because you have to have yourgoals aligned at every level,
(14:40):
and we use like EOS as a greatbase for that, and it's helped
us align all of our internalstaff to be on the same page so
we can effectively row togetherat the same time, and we're
gonna go much further if we dothat.
What's the point of working sohard, buying these properties,
managing these properties, ifyou're then overpaying on taxes
(15:03):
at the end of the year?
Right, it kind of defeats thepurpose, right?
Of it's like having a bucketwith holes in it and then
putting water into it.
Okay, you can keep topping it upwith water, but it's always
gonna drain out because you'vegot too many holes in it.
So let's patch up the holes andkeep the water in the bucket.
How do you do that?
You do it by having a betterteam, right?
(15:24):
So the team that's got you whereyou are today isn't the team
that's gonna get you where youwant to be in the future.
And it isn't the team that youstarted with on day one, right?
You have to constantly evolvethat team.
And I'm not saying go fire yourCPA.
Your CPA could be doing a goodjob and keep them in place, but
just bring in additionaleyeballs around certain things
that you want to focus on togive you the best outcome
(15:47):
possible for reaching thosegoals.
SPEAKER_01 (15:49):
Right.
Well, let's say uh I've got aquestion because uh a lot of our
rent-ish listeners are also, youknow, smaller mom and pop
property managers or landlords,people that manage maybe a few
units, college housing, youknow, what whatever the case may
be.
I mean, are are there taxstrategies that you would you
would recommend for like arethese strategies that would work
(16:11):
for people of that scale too?
Or is it really only for thesebig investors, like these big
clients that want to go above?
SPEAKER_03 (16:17):
No, it would work.
Anyone, I would say, as aballpark, if you want to pin
down a number, anyone whose taxliability is over$200,000 or is
expecting to be over$200,000 inany given year needs to look
into a structure.
Up until that point, I wouldargue there's enough loopholes
that you can use by justGoogling it.
(16:38):
Chat GPT, it'll give you themall, right?
That you don't need our servicesor another tax strategist
because below that you can getit down to a very reasonable,
manageable amount.
And most people, honestly, theydon't mind paying some tax, they
just don't want to be overtaxedfor stuff that then goes into
like a$37 trillion deficit,right?
(17:00):
So it's like they get the to paytheir fair share.
But what is their fair sharewhen there's a crazy amount of
potholes in the roads andthere's people going off to wars
and shit like that that you knowwe don't need to get into.
But the bottom line is mostpeople are good, hardworking,
and don't mind paying something,but they don't want to overpay.
(17:20):
And the the reality is that 92%do overpay, and that boils down
to generally just not having agood enough team right now uh to
help you save that extra 50-60%a year, because that saving can
go on to compound and create agreat legacy.
So imagine if you're makinglet's just say 500k in taxes a
(17:43):
year, if you're paying thatmuch, right?
And you can save 50% a year,that's 250,000.
How much more real estate canyou reinvest that into and
leverage and kind of extrapolateon top of?
Sure.
And then not even to mention theuh the amount of structure, the
benefits of these structures areit can eliminate capital gains
(18:04):
tax.
So you don't have to worry aboutdoing a 1031 exchange every few
years and kind of getting into abigger and bigger property, you
can diversify, you can actuallytake some of that equity out and
and spend the cash however youwant to a degree, rather than
leaving it all tied up and beingasset rich and cash poor.
SPEAKER_00 (18:23):
Once you get the let's you build your team, which
you said is like a great firststep.
Don't just rely on just the CPA,get a tax strategist, get
multiple eyeballs on it.
After that, is it kind of like ahands-off sort of thing for like
let's say the landlord or theproperty owner or property
managers or who whoever is gonnais going to use the tax
services, but or is are therethings that they should continue
(18:45):
doing once they've kind ofassembled a team of experts,
even if they're not like taxexperts themselves?
SPEAKER_03 (18:51):
Yeah, I would say that that never ends, right?
Because building a team is um isalways an ongoing thing.
You and because once you buildyour team, you then want to
build a bench.
Like you look at the likes ofthese big Fortune 500 companies
that operate tens of thousandsof people globally.
How do they do it?
And that's my background, right?
I was working for a big Fortune500 company, and it was like I
(19:13):
learned how to do all thisstuff, but that was just my norm
because that was the environmentI was in.
So it's like, okay, let's builda team of A team players, and
now we need to build a bench of18 players because if any of my
A-team get poached by someoneelse, I'm gonna miss a trick
here, and then I'm gonna be out.
So I need to make sure I've gotthe next position filled, or at
(19:36):
least two or three peopleidentified for that.
And that could be as simple aslet's let's just bring it back
to real estate as a propertymanager.
If you've got a really goodelectrician that you like that
works across your properties orin an area, then that's
fantastic.
Keep hold of that guy, but makesure you hire the next
electrician or at least have twoor three people that will also
(20:00):
give you quotes for that job.
So, one, you know the firstguy's not getting complacent.
And secondly, if somethinghappens to him, you've got two
or three other options.
So you're not the one thenflapping around on Yelp or
Google to try and find the nextelectrician, right?
So I think strength and depth isreally important.
And we talked about sportsbefore we started recording, and
(20:21):
think of it as having a reallygood bench on your baseball
team, right?
Which are not probably as goodas the Dodgers, but we won't get
into that either.
Um, we certainly don't have toget into that, but thank you for
bringing it up.
That's very kind of you.
That's how to run a business,right?
So, again, if you use a goodmethodology, what we use is a
(20:41):
mix of EOS, which isentrepreneurs organization.
Uh, sorry, EOS is uh what's itwhat's the guy's name?
Traction.
Traction is the book, and uhGino Wickman is the author.
It's fantastic methodology onhow to run an organization.
And then if you have a good bookfor the HR stuff and the hiring
(21:03):
stuff is top grading, that'swhat we use.
So we you we use like a mixtureof different things over the
years that we've liked, and thenwe've kind of took the best bits
of other things and kind of madeour own little Frankenstein.
But generally speaking, it's allabout people, right?
Any business that runs well, italways boils down to the people.
And the hard part for me as afinance guy is the people are
(21:26):
not valued on any financialstatement at all.
Yet without them, none of thesebusinesses run at all.
So it's like make sure you havea really good team and a backup
team in place.
Everyone knows what they'redoing, they have really solid
standard operating procedures sothat if one person's off sick or
another person's on maternityleave, that the shit doesn't hit
(21:48):
the fan, right?
Right.
People can step into that and doit.
And then if they've got a greatsoftware like what you guys
produce, then they'll knowwhat's going on clearer and
easier in their business, andthat'll equate to better
financials and better numbersand then better multiples and
better cap rates.
It kind of all stacks on top ofeach other, but you have to have
that solid foundation first.
SPEAKER_01 (22:09):
Yeah, definitely.
Well, we've talked a lot aboutuh the tax side of what it is
that you do, but I want to askyou about your about asset
protection.
This is a term that we've notreally covered on the rent ish
quite yet.
We do a lot of episodes wherewe'll kind of deep dive into a
specific real estate term, butin terms of asset protection,
can you elaborate on exactlylike what that might mean for
(22:29):
someone that's brand new intoproperty management or into into
home ownership or anything likethat?
SPEAKER_03 (22:34):
Absolutely.
So when we look at assetprotection, really what we aim
to do with all of our clients iswe want to make them like a
ghost.
You shouldn't be able to findthese people at all or what
assets they own.
Uh, and that's the best way froma liability standpoint because
here in America, it's such alitigious country, it's
(22:55):
ridiculous, right?
You can sneeze in the wrongdirection and you're gonna get a
lawsuit.
And it's like, what?
I just sneezed, but uh, that'sjust the way it is.
So the way to protect yourself,um, and especially as you're
growing an empire, right?
This is really, really importantto make sure you have levels of
entities, whether they aretrusts, whether they are LLCs,
(23:17):
uh, whether they are whatever itis, it just shouldn't be in your
name directly, right?
Because, and then there's levelsto that.
So if you go down, let's justuse a simple example.
Let's just say one LLC perproperty.
Now make sure that that LLC isin a really good state, like
Delaware, Wyoming, or Nevada,because you don't want your
(23:41):
information to be public toanyone, right, who owns that
LLC.
And you can have a registeredagent and all of those types of
things.
And there's so many companiesout there that do a good job at
kind of pre-building all ofthat.
So you just one click and boom,away you go.
Because if you do get into alawsuit, the first thing these
ambulance chasing lawyers willdo is call an asset search.
(24:03):
They will literally search everydatabase they can see whatever
assets are in your name, andthen they'll assign a value to
that, and then they'll look atthe case and they'll assign a
settlement value to the case.
Now, if that value issubstantial and they can find a
lot of stuff in your name,they're likely to take that case
on.
But if nothing comes back orvery little comes back, they
(24:25):
won't take the case on.
So the person trying to sue youwill not find a good lawyer and
they'll likely lose the case, orthey'll just drop the case
completely because I'm assumingfor your listeners, nine times
out of ten, it's going to be afrivolous case anyway.
And people just trying to shakepeople down.
And we see this all the everyday.
We have a lot of uh doctors asclients of ours, and what
(24:48):
happens is they'll open apractice and they'll open a
second practice, and thenthey'll start getting stupid
lawsuits for like, hey, thisdisabled sign is actually two
centimeters too high, it needsto be two cents, and that caused
me a lot of harm.
So now you have to uh pay me ahundred thousand dollars.
Like you think you might thinkthat's stupid.
It happens here in Californiaway too often.
(25:11):
So you know, you gotta justprotect yourself.
So if that property isn't inyour name and it can't be easily
traced back to you, thoseambulance chasing lawyers will
find a zero settlement value andthey won't take the case.
So uh it's really important fromthat.
And then again, if you'regetting into marriages, let's
(25:31):
say we get this one a lot from alot of our rich clients.
So they're like, hey, I want toprotect my assets from this
person who I may or may not endup marrying.
How do I do that?
And it's like, all right, okay,now we're talking.
So again, we'll show themstructures on do it this way,
because then you never own theproperty.
Because when you when you lookat the mindset of the elite and
(25:53):
the billionaires, they are very,very comfortable with this one
strategy, which is own nothing,control everything.
And you may or may not haveheard of that before, but it's
really, really important.
Own nothing, control everything.
So let's use an example of aprivate jet.
If you don't own the jet, it'snot a big deal.
As long as you can go on the jetwhen you need to, and it can
(26:16):
take you where you want it to bego whenever you want.
Does it really matter if thatjet is in your name, Zach, or
Pat's name?
It doesn't really matter at all,does it?
No.
But regular people get so caughtup on that.
No, it has to be in my name.
I have to own it.
Well, taxation followsownership.
(26:36):
Taxation doesn't follow control.
So if you don't own it, it'sactually in your best interests
not to own it, and it's in yourbest interest to control it.
Okay.
Gotcha.
Interesting.
SPEAKER_01 (26:48):
Okay.
No, well, if Taylor Swift everasks us about her private jet
fleet and needs some advice orwhatever, we'll tell her, we'll
let her know exactly what sheneeds to do.
I bet you send her over.
I can have her hours, but she'sthe guest next week, so it's a
you know good uh good timing.
SPEAKER_03 (27:02):
We'll do that one in person and I'll fly in for it.
SPEAKER_00 (27:05):
Okay, perfect.
I yeah, I'm I'm reallyinterested in all of this.
So do you have like an example?
Do you have an example of likemaybe like a simple strategy
that like you know anyone cansort of understand without
having like a deep knowledge ofof sort of like the tax code and
stuff that has saved like one ofyour clients or somebody you
(27:26):
know like a lot of money, andit's just like a simple thing
that you might not think of.
I'll give you two.
I'll have to achieve.
SPEAKER_03 (27:32):
All right, the first one.
The the first one is for allthose people that are uh
employees, corporate employees,right?
W-2 employees.
So if you've got a job andyou're working for someone and
and it's a good job, so you'remaking a lot of money and you're
paying a lot of taxes.
Again, a lot of our clients arelawyers and doctors, right?
So they fit that mold of makingmulti-six, multi-seven figures,
(27:56):
but it's all as a W-2 salary, sothey are in the system and
there's not many loopholes ordeductions they can take.
So, what they can do is they cancreate a private non-operating
foundation.
I'll say that again, it's a bitof a mouthful.
Private non-operatingfoundation, and what that will
(28:18):
allow them to do day one isdonate 30% of their top line
salary into the foundation, andthey can invest that money
through the foundation.
So let's break that down intowhat that actually means.
Then let's use simple numbersbecause I don't have a
calculator next to me.
So let's just say that a doctormakes one million dollars a year
(28:39):
salary from a hospital.
Usually they'll pay 40% tax inCalifornia, let's say it's 400k.
Now they can donate 300,000, 30%into that private foundation,
right?
So now their tax rate will dropdown to 700,000 rather than the
(29:02):
million dollars.
So 40% is 700,000 as well, 280.
So now instantly they've gonefrom paying 400,000 a year in
tax to 280,000 in tax.
So they've saved 120,000 bydonating 30% to themselves,
effectively, that they stillcontrol in the other hand, and
(29:24):
they can then reinvest thatmoney in a tax-exempt
environment.
So, what does that mean?
So that means now I've justsaved you 120,000 on your right
hand on your day-to-day job,right?
But on your left hand, you'vegot 300k now.
You can go invest in realestate, you can leverage it,
you're only gonna pay a 1.4% taxrate on any income it produces
(29:45):
if it's passive investment.
I'm gonna completely eliminatecapital gains tax.
So let's say we go buy abuilding for a million dollars
and we put down 300,000, right?
Right.
So it's gonna cash flow a littlebit, so we're happy.
So anything that it cash flows.
Flows we pay 1.4% tax on, andnow let's fast forward four
years, and the property'sdoubled from one million to two
(30:06):
million, and we want to sell it.
You pay zero capital gains taxon that.
Wow.
Wow.
All while paying a 1.4% tax ratealong the way.
And now you've got two milliondollars in this foundation.
Go do the same thing, keepgoing.
SPEAKER_00 (30:24):
Yeah, that's so that seems so obvious, but I that's
so interesting.
I never knew about that.
So that's number one.
Let me give you number two.
SPEAKER_01 (30:33):
Yeah, he's like keep going.
All right, I've already hit,I've already hit one ball out of
the park.
Let's see if we can get numbertwo.
You're on a roll, Katie.
SPEAKER_03 (30:43):
Call me Bib Ruth.
Well, actually, Atani is the guyout here now, right?
That is the guy there.
Yeah.
He is the man.
So anyway.
SPEAKER_01 (30:53):
Second Dodgers reference in one single podcast.
I don't know if I can handle it.
SPEAKER_03 (31:00):
And then okay, so the second one is actually more
powerful because it applies toall business owners, right?
So simply put, your net profitthat flows to you is technically
called your AGI in accountingterms.
Let's just call it net profitbecause most people will
understand that, and we don'tneed to get into the tax jargon.
So let's say your net profit isone million dollars again.
(31:23):
We'll use the same numbers.
You can donate 50% of that to alimited partnership.
Now, if people don't understandwhat a limited partnership is,
it's similar to an LLC, S Corp,C Corp.
It's just a type of entity,right?
It's an entity type.
But the difference with alimited partnership is you have
two partners.
(31:43):
You have a general partner thathas power and control, and then
you have a limited partner withno power, no control.
Effectively think of the limitedpartner as a silent partner,
right?
So it's perfect that we have twoof you on.
So let's call Zach the generalpartner, and let's call Pat the
limited partner for thisexample, right?
And now we've got me that's gotthis million dollars that's come
(32:06):
to me, and I'm gonna put 50% ofit into your partnership.
So with that 50% is$500,000that's now in this partnership.
And Zach, let's say you are thegeneral partner but own one
percent, but still have fullpower and control, and Pat,
you're the silent partner, butyou own 99%, but no power, no
(32:30):
control.
The 500,000 is in Zach's hands,and he can do with it pretty
much what he wishes, right?
So let's just say that Zachinvests that in some multifamily
real estate and he grows itbecause Zach's a smart guy, he
knows what he's doing, right?
Thank you for the compliment.
I think someone out there wouldargue that.
(32:50):
Maybe Zach's mother would argue,but nobody else.
But Zach, she's there, so we'llwe'll take a view.
And then now that 500,000 growsto let's just say a million
dollars.
So you doubled your money,right?
Great, you'd have to pay capitalgains tax, right?
If it was, let's say, a propertythat went up in value, or even
(33:10):
if it wasn't, even if it wasjust on passive income that
produced dividends, you pay somesort of tax on that growth,
whether it's annual ordinaryincome tax or whether it's
passive or capital gains, therewould be some tax on that
incremental growth.
But if Zach only owns onepercent of it, then he would
only be taxed on his onepercent, right?
(33:32):
The majority of that tax billhas come into Pat because he
owns 99% of it.
We agree, yeah.
SPEAKER_01 (33:38):
Sounds like sounds like a good deal to me.
SPEAKER_03 (33:42):
It gets even better.
So listen to this.
So what if Pat was a non-profit?
So he doesn't care.
So 490,000, 95,000 can come intopart as a K1, again, technical
terms, but generally speaking,there's a difference between a
distribution and a K1.
(34:02):
Let's get into that first beforewe get into the next step.
So the the that means that that$1 million that Zach's made in
the LP can stay there, it doesnot have to be distributed.
There's no law saying you haveto issue a distribution every
single year or at all, right?
But what you have to do everysingle year is issue a K1
(34:23):
because someone has to pay forthe profit of that business that
given year.
So Pat is gonna pick up 99% ofthat K1, and Zach is gonna pick
up 1% without the money leavingthe company.
The money stays where it is, soZach still has all of the money
in his hand to go play with.
(34:45):
Pat gets a K1 for 99%, doesn'tcare because he's tax exempt,
and then Zach will pay his fairshare of taxes on his 1% and
happily pay that, right, Zach?
Quite happily, yeah.
SPEAKER_01 (34:58):
Call me the happiest man alive.
Yeah, sure.
Wow.
SPEAKER_03 (35:01):
That makes sense.
That's a lot of levels and alittle bit more complex, but
that number two is really wherethe where the rubber meets the
road.
Cool.
Well, that's awesome, Casey.
SPEAKER_01 (35:10):
It's a great way to break it down.
I think it's very clear for alot of people to kind of hear
the visor the visualization ofeverything.
It's been great listening toyour passion about you know
everything that Together CFOdoes.
Uh, I mean, tell us where tellthe audience, not just us, all
the people that are listening tothe show, like where can they
learn more about your guys'company, what you guys are
(35:31):
doing, anything that youbasically like to plug about
together.
SPEAKER_03 (35:34):
Yeah, so uh you can find us.
Our website is togethercfo.com.
We're all over YouTube if youwant to watch some more videos
of me talking.
Uh, and then there's loads of uhInstagram, YouTube, Facebook,
all the rest of that, all thesocials are all together, CFO.
Uh, and then we have a schoolgroup as well.
So school.com forward slash tax.
(35:56):
We have the top 50 loopholes forevery anyone who wants to
actually reduce those loopholesand doesn't need to be in the
top levels, but you know,something for everyone there.
So if you join our schoolcommunity, you get that for
free.
And what I recommend is todownload it, send it to your
CPA, and ask them how many ofthese 50 loopholes are we using
right now?
(36:17):
And then you'll have a list ofwhat you're using.
More importantly, ask for anexplanation as to why you're not
using the others.
Right.
Because if you don't get thattimely and you don't get that
detailed, it tells youeverything you already need to
know about your CPA that youneed to upgrade.
That's like what we touched onearlier, right?
SPEAKER_01 (36:33):
Yeah, yeah.
Grilling the CPAs.
I think we're gonna get a lot ofcomments on this thread about uh
I talked to my CPA and they weredoing what?
They didn't do this, they didn'tdo that, the other.
SPEAKER_03 (36:43):
So gonna be a lot of upset people, but 92% of people
are overpaying, and that's for areason.
So if we can help reduce thatand get some money back in the
people's pockets, then I'm allfor that.
SPEAKER_01 (36:54):
Okay.
Awesome, Casey.
Well, thank you again forjoining us on this episode of
the Rentish Podcast.
It's really been fun to listento you talk and just kind of
hear about your your passion andeverything.
Uh, we'd love to have you backon the show anytime that you'd
love to swing by and hang outwith us.
We have one fun question wealways end the our guest
segments with.
And I've gotten criticism forasking what's your favorite
movie of all time?
(37:14):
Because certain people are like,Oh, I don't know if but is that
easy for KC?
Okay, so perfect.
So best movie of all time.
SPEAKER_03 (37:21):
Gladiator, hands down, Gladiator.
Gladiator.
SPEAKER_00 (37:23):
Okay.
SPEAKER_01 (37:24):
Good pick, Ridley Scott.
Great movie.
SPEAKER_00 (37:26):
I love how you had an answer because most people,
it's like as though they'venever been asked that question
before about what their favoritemovie is.
You know what I mean?
SPEAKER_03 (37:32):
Just one.
There's so many good ones, butwhen when I go back to my
default, Gladiator just has itall, right?
Yeah, it does.
SPEAKER_00 (37:41):
Sweet movie.
SPEAKER_01 (37:42):
Well, what we do on this pod echoes an eternity.
And I've been Zach, that's beenPatrick.
You can find us at the RentishPod on social media questions at
therentish pod.com.
Follow us there, like us andsubscribe if you uh use Spotify.
Give us a five star rating.
If you use Apple, just give usone of those likes or a rating,
whatever they do on that serviceover there.
And then you can comment,download the podcast, listen to
(38:04):
us.
Thank you guys very much forlistening, and uh, we'll see you
next time.
Thanks for having me, guys.
What's going on, everybody?
Welcome to season two of theRent Ish Podcast.
I'm Zach and I'm here with myco-host Patrick.
SPEAKER_00 (00:09):
We're two rookies chasing the dream of real estate
investing.
In this podcast, we'll talkabout property management, wild
stories, and everything inbetween.
We don't know it yet.
SPEAKER_01 (00:18):
But that's the point.
We're learning as we go, justlike you.
We'll bring in the experts toeducate us and inform us and
we'll figure it out together.
So let's laugh, learn, and diveinto real estate side by side.
Patrick, this is the newfrontier of the Rent Ish Podcast
because this is all digital.
We've given up, we've given upon being face to face at this
point.
We got tired of each other'scompany, so now we're all Zoom.
(00:40):
We're in the 21st century.
So high tech.
High tech, high tech, high tech.
Yeah.
So the listeners out there,thank you for dropping by for
this episode of the RentishPodcast.
You know all the places that youcan typically follow us, social
media at the Rentish Pod.
You can email questions at theRentish Pod.com.
And there's plenty of otherplaces to find us, like us, and
subscribe on your podcast, feetof choice.
(01:01):
But there's no sense of reallykind of dilly-dallying around.
Usually I would ask Patrick howhis day is going, but I don't
really care right now.
We don't care, yeah.
Yeah, no.
Because we've got much moreimportant things to do right now
because we've got a very, very,very special guest.
We are joined today by CaseyChohan.
And in this segment, we're goingto be talking about a smart tax
planning, asset protection, andhow it can help landlords and
(01:21):
real estate investors keep moremoney in their pockets and
protect what they've built.
Founder of Together CFO, Caseyis known for helping real estate
investors and business ownerssave money on taxes and protect
their wealth.
He's all about showing peoplestrategies that most of us don't
even realize exist yet.
And he's worked with investorsat every stage of their journey.
Casey, we're so excited to haveyou on the Rentish.
(01:41):
Welcome to the show.
SPEAKER_03 (01:42):
All right, let's go, boys.
I love the energy already.
SPEAKER_01 (01:45):
Yeah.
We're trying to keep it up.
How many cups of coffee have youthat can we do or we on the
room?
SPEAKER_03 (01:50):
I'm on like third one and it's about 12 o'clock,
so I'm doing all right.
SPEAKER_01 (01:53):
Okay, you fit right in that.
Yeah, knowing Patrick, he'sprobably on the floor.
SPEAKER_03 (01:59):
Like I'm kind of addicted to Nespresso right now.
SPEAKER_00 (02:02):
Yeah.
We just got in the office, wegot a new uh Nespresso machine
like a month ago, and I've beenhammering that because we we had
like the crappy cure eggsbefore, but now it's like water,
muddy water, it's disgusting.
SPEAKER_01 (02:14):
Yeah.
Welcome to the coffee cast.
We're gonna talk about uh thedifferences between no, no, no,
no.
Casey, we brought you on boardbecause you're an expert in your
field and uh we wanted to hearabout all the things that you
have to tell us about uhTogether CFO, along with uh tax
planning and asset protection.
So without belaboring the pointat all, I mean tell us a little
bit about you.
(02:34):
But you know, how did you getinto the industry?
What's your passion?
What makes you tick here?
SPEAKER_03 (02:38):
Well, I stumbled into tax savings because as you
can hear, I'm not American.
I'm born and raised in Englandand I have no real business over
here doing tax stuff, but I fellinto it and I doubled down on
it, and now I own my own smalllittle niche within a sub-niche.
So my background is inaccounting and finance.
(03:00):
I was working for a big Fortune500 company for eight plus
years.
I did four in Europe and then Itransferred to America, did
another four here until I uh gotmy green card and started my own
company.
I didn't really like corporateAmerica when I landed here, but
um, it is what it is.
You gotta pay your dues and youmove on, right?
So uh I started my own businessas an outsourced fractional CFO,
(03:25):
as the name suggests, togetherCFO.
And then what happened was inthe first year we we stumbled
into a huge success with aclient.
We took him from five million ayear to 120 million a year, and
that created a huge tax problemfor him, or it was about to if
we didn't fix it.
So he then kind of begrudginglypushed me into figuring out how
(03:50):
to reduce his taxes at that highlevel, which is very different
to fixing a tax problem at amillion dollars a year or like a
couple of million, like 120million is a lot of money,
right?
Right, so the loopholes thatmost people use were not going
to be applicable at that hugelevel, right?
So when we look at real estate,so many great loopholes you can
(04:12):
use, you know, uh bonusdepreciation, cost segregations,
hub zones, there's loads ofthem, right?
And uh, you could be aprofessional real estate person.
Obviously, all of these gowithout saying.
I'm sure the listeners alreadyknow a lot about all of them.
But when you get into likemillions of dollars and we're
talking multi-seven,multi-eight, multi-nine figures,
(04:35):
you need structures to go on topof the loopholes.
Like everyone should be usingloopholes, regardless of if
you're starting day one or ifyou're just entering year 10.
Everyone should maximize all ofthose because that's what the
government is incentivizing usto do.
They're saying take this actionand we will give you a credit
(04:56):
for it, whether it's as simpleas going to buy a car or an
electric car because you get anextra seven and a half thousand
dollars off that, right?
So they're saying do thisactivity and we will reward you
with a credit.
Okay, great.
But they're gonna cap thatcredit, they're not gonna give
you an endless amount of credit.
And a great example of this isretirement accounts.
(05:17):
You can only put tens ofthousands into these retirement
accounts, but if you're making acouple of million dollars, tens
of thousands just aren't gonnacut it.
You need something more robust,something bigger than just
ordinary loopholes, and that'sreally where we come in.
So we take the structures andthe entities that are used by
(05:38):
family officers and the elitebillionaires, and we simplify it
so that it can be used by themodern day multi-seven,
multi-eight figure businessowner.
And then that has a few knock-onconsequences.
One, you significantly reduceyour tax burden, it's asset
protection, it's legacycreation, and there's often a
(05:59):
bit of philanthropy thrown inthere just for the sprinkle on
top.
SPEAKER_00 (06:03):
So, Casey, I don't know if I maybe like
misunderstood, but it soundedlike when you started the
company, which it this is allsuper interesting, but when you
started the company, you hadmaybe like different ideas for
what the company was gonna be.
And then because of the client,like this lot huge client, you
kind of like totally had toshift gears and and kind of like
(06:24):
like how what what was thatlike?
And like, was that kind of ajarring experience for you?
Is it was it interesting to you?
Was it kind of scary, likehaving to kind of go down the
top?
SPEAKER_03 (06:35):
So scary because, like, in my mind, what's
happened is I've gone from areally good, comfortable
corporate job that I've been atfor eight years, making
multi-six figures, living a goodlife, right?
Moved to LA, the sun's shining,I'm in a shorts and t-shirt,
there's lots of beautiful womenhere, and I'm a single guy, so
(06:55):
you know you can figure out therest yourself.
Um, and then it's like, holyshit, I'm I'm not having that
comfort anymore, and I'mstarting my own business, and
I've kind of backed myself, andit's like, all right, now it's
go time because if I don't getany clients, I don't make any
money.
Now that's on me, right?
(07:16):
And again, I mitigated that.
I didn't just split the switchand go.
I knew that was coming down thepipeline, so I took steps along
the way to make sure it was assmooth as possible.
So I had a handful of clientsbefore I put my notice in.
So I knew I would make X amountof money regardless of what,
unless I lost some of thoseclients.
What actually ended up happeningis one of them took off and it
(07:39):
went crazy.
And yeah, I pivoted becauseyou've got to be flexible,
right?
You've got to be able to go withthe ebbs and flows of a business
because it's not always gonna bea smooth, straight line.
And in fact, none of them everare a smooth, straight line,
right?
So there's always gonna bemassive ups and massive downs,
but you're totally right.
We started off doing fractionalCFO services, but then once we
(08:03):
figured out, hey, we saved him,let me close the loop on that.
We saved him about 12 milliondollars in that first year on
taxes by creating the structuresthat we're talking about.
Wow.
So for me, it was like, oh, holyshit, if we can save this guy
this much money, there's plentyof other people out there that
have we can use similarstructures for and have the same
(08:24):
level of savings.
Why should the family officesand the elite billionaires get
to use all of this?
But the people that need it themost, they're just kind of
priced out of it because theycan't afford a five million
dollar a year family office.
Right.
So we kind of took that subsetof hey, maybe you don't need all
12 people of the family office,maybe you just need us.
(08:45):
So we can significantly cut downon that five million dollar
overhead and give you one pieceof the family office that is
probably the most valuable toyou right now, and then you can
add the other pieces in later asyou go.
Very cool.
SPEAKER_00 (09:00):
Yeah, it makes a lot of sense.
And so, in terms of because I Iam speaking for Zach here, I I'm
I'm not 100% I'm accurate onthis.
I'm not any sort of tax expert.
No, Zach.
Okay.
Yeah, we're uncharted.
Yeah, I I you know we'll use theturbo tax at the end of the year
(09:21):
and call it a day sort of thing.
Um but um how how does like withworking with several different
clients is a lot of the sort oflike the tax breaks and these
sort of incentives and differentloopholes, as you've said, does
that shift radically from clientto client based on their
business?
Or is it kind of like do youhave like a set sort of
(09:42):
procedure on how to how to helppeople out with this kind of
thing?
SPEAKER_03 (09:45):
Yeah, so let's break it down into two different
levels, right?
Okay, so the loophole level,which everyone should be using
as much as possible, is gonnachange all the time uh based on
administration that's in, howlong they're in, and what they
want to incentivize in theeconomy, right?
Because their global macropicture is hey, we need to boost
(10:07):
these three areas.
What can we do to boost that?
And use EV cars as a primeexample of that.
Okay, so since Tesla kind ofkicked off, they've been doing
this$7,500 credit for electriccars, right?
But if you want to go in anelectric car, you're gonna get
an additional seven and a halfthousand dollars.
So if you've got two cars thatyou're looking at, let's just
(10:29):
call one of them uh let's use acamry, right?
Let's use a camry versus a Priusbecause they're both Toyotas.
One can be electric, one can bepetrol or gas, as you guys say.
And then if I'm gonna get sevenand a half thousand more off
this one, I'm gonna do that.
That's gonna incentivize me totake the action that they want,
go buy a car, or maybe if Icouldn't quite afford a car, but
(10:51):
now I can because it's seven anda half thousand dollars cheaper,
maybe I'll go and buy a car.
So now you get more people doingthat action that you want to
stimulate the economy in the waythat you want it.
So that's like a governmentthing, and then on top of that
is more of a longer standinglegacy thing, which is
structures.
(11:11):
Because when it comes down toit, the bottom line is you are
only as good as the team aroundyou, which you can apply to real
estate, property management,software, whatever company you
want.
Because if you're only relyingon one person's expertise, like
a CPA as an example, then youcould be leaving so much money
on the table if they don't knowwhat they're doing.
(11:34):
So this is why 92% of peopleoverpay on their taxes because
they are too reliant on oneperson.
And then the deeper question ispeople get it so twisted.
The CPA's job is not to save youmoney on taxes.
Look at your agreement with yourCPA.
It doesn't say that anywhere.
(11:56):
It says that their job is tomake sure you file and pay your
taxes.
People just automatically assumethat, hey, just because you're
filing it and you're telling mehow much my quarterly estimate
is and you're making sure I payit, and how much to pay to who,
because there's like fivemillion agencies you've got to
pay around here, that you'realso helping me save money on
taxes.
That's not true.
A tax strategist will help yousave money on taxes because you
(12:20):
are paying them a percentage ofwhatever they save you versus a
CPA who's gonna get a flat feeregardless of if he saves you
$100 or$10 million.
SPEAKER_00 (12:32):
Interesting.
I never even thought about that.
I I guess I'm sort of thinking,like, oh, you pay the CPA, their
job is to help you, but I guessthat makes sense.
A tax strategist is what youwant to be able to save the
money.
SPEAKER_03 (12:43):
Well, think about it, right?
So if you speak to your CPA,let's say once or twice a year,
like the average person, andyou're flapping around at the
end of the year to say, hey,what else can we take to write
off?
I don't want to pay this much intaxes.
He doesn't really care at thatpoint.
He's like, Well, I've gotanother 500 clients here,
another thousand clients I haveto do the exact same thing for.
(13:05):
And me taking five more hours tofigure out what loopholes we can
jump through for you, orlearning and going uh across the
country to do a seminar oractually reading some of these
stupidly boring books behind mein terms of figuring out what is
available, it's not gonna happenbecause he is not getting paid
to do that.
And unless you're consulting himat$500,000 an hour and paying
(13:28):
him to do that, it's not in hisbest interest to grow his
business by saving you money ontaxes.
Just keep filing, send me areferral if you can, and I'll
talk to you once or twice ayear.
That's kind of the mindset ofthe CPA.
SPEAKER_01 (13:43):
$500,000 an hour sounds like a reasonable rate
for a CPA, I'd say.
There you go.
Okay, that was I heard thatnumber I was like, that was my
rate I was giving you.
Um well, you might have kind ofanswered it with like kind of
getting off on the right footwith figuring out where you need
to go in terms of your ownportfolio or whatever, but like
(14:06):
what's that most common mistakethat you see so many people make
with with their taxes at thevery like at the jump?
Like, is that the common is thatthe most common thing is that
people just don't don't knowwhere to go from the jump?
They don't know where which wayto handle their money.
SPEAKER_03 (14:19):
There's a couple of things that most people don't
even realize.
So Pat's a prime example, right?
Because you're very honest.
You're like, well, I didn't eventhink of that.
Most people don't, and it's likestep one is is your CPA working
for you, or do you need to gofind a team that is working for
you?
Because you have to have yourgoals aligned at every level,
(14:40):
and we use like EOS as a greatbase for that, and it's helped
us align all of our internalstaff to be on the same page so
we can effectively row togetherat the same time, and we're
gonna go much further if we dothat.
What's the point of working sohard, buying these properties,
managing these properties, ifyou're then overpaying on taxes
(15:03):
at the end of the year?
Right, it kind of defeats thepurpose, right?
Of it's like having a bucketwith holes in it and then
putting water into it.
Okay, you can keep topping it upwith water, but it's always
gonna drain out because you'vegot too many holes in it.
So let's patch up the holes andkeep the water in the bucket.
How do you do that?
You do it by having a betterteam, right?
(15:24):
So the team that's got you whereyou are today isn't the team
that's gonna get you where youwant to be in the future.
And it isn't the team that youstarted with on day one, right?
You have to constantly evolvethat team.
And I'm not saying go fire yourCPA.
Your CPA could be doing a goodjob and keep them in place, but
just bring in additionaleyeballs around certain things
that you want to focus on togive you the best outcome
(15:47):
possible for reaching thosegoals.
SPEAKER_01 (15:49):
Right.
Well, let's say uh I've got aquestion because uh a lot of our
rent-ish listeners are also, youknow, smaller mom and pop
property managers or landlords,people that manage maybe a few
units, college housing, youknow, what whatever the case may
be.
I mean, are are there taxstrategies that you would you
would recommend for like arethese strategies that would work
(16:11):
for people of that scale too?
Or is it really only for thesebig investors, like these big
clients that want to go above?
SPEAKER_03 (16:17):
No, it would work.
Anyone, I would say, as aballpark, if you want to pin
down a number, anyone whose taxliability is over$200,000 or is
expecting to be over$200,000 inany given year needs to look
into a structure.
Up until that point, I wouldargue there's enough loopholes
that you can use by justGoogling it.
(16:38):
Chat GPT, it'll give you themall, right?
That you don't need our servicesor another tax strategist
because below that you can getit down to a very reasonable,
manageable amount.
And most people, honestly, theydon't mind paying some tax, they
just don't want to be overtaxedfor stuff that then goes into
like a$37 trillion deficit,right?
(17:00):
So it's like they get the to paytheir fair share.
But what is their fair sharewhen there's a crazy amount of
potholes in the roads andthere's people going off to wars
and shit like that that you knowwe don't need to get into.
But the bottom line is mostpeople are good, hardworking,
and don't mind paying something,but they don't want to overpay.
(17:20):
And the the reality is that 92%do overpay, and that boils down
to generally just not having agood enough team right now uh to
help you save that extra 50-60%a year, because that saving can
go on to compound and create agreat legacy.
So imagine if you're makinglet's just say 500k in taxes a
(17:43):
year, if you're paying thatmuch, right?
And you can save 50% a year,that's 250,000.
How much more real estate canyou reinvest that into and
leverage and kind of extrapolateon top of?
Sure.
And then not even to mention theuh the amount of structure, the
benefits of these structures areit can eliminate capital gains
(18:04):
tax.
So you don't have to worry aboutdoing a 1031 exchange every few
years and kind of getting into abigger and bigger property, you
can diversify, you can actuallytake some of that equity out and
and spend the cash however youwant to a degree, rather than
leaving it all tied up and beingasset rich and cash poor.
SPEAKER_00 (18:23):
Once you get the let's you build your team, which
you said is like a great firststep.
Don't just rely on just the CPA,get a tax strategist, get
multiple eyeballs on it.
After that, is it kind of like ahands-off sort of thing for like
let's say the landlord or theproperty owner or property
managers or who whoever is gonnais going to use the tax
services, but or is are therethings that they should continue
(18:45):
doing once they've kind ofassembled a team of experts,
even if they're not like taxexperts themselves?
SPEAKER_03 (18:51):
Yeah, I would say that that never ends, right?
Because building a team is um isalways an ongoing thing.
You and because once you buildyour team, you then want to
build a bench.
Like you look at the likes ofthese big Fortune 500 companies
that operate tens of thousandsof people globally.
How do they do it?
And that's my background, right?
I was working for a big Fortune500 company, and it was like I
(19:13):
learned how to do all thisstuff, but that was just my norm
because that was the environmentI was in.
So it's like, okay, let's builda team of A team players, and
now we need to build a bench of18 players because if any of my
A-team get poached by someoneelse, I'm gonna miss a trick
here, and then I'm gonna be out.
So I need to make sure I've gotthe next position filled, or at
(19:36):
least two or three peopleidentified for that.
And that could be as simple aslet's let's just bring it back
to real estate as a propertymanager.
If you've got a really goodelectrician that you like that
works across your properties orin an area, then that's
fantastic.
Keep hold of that guy, but makesure you hire the next
electrician or at least have twoor three people that will also
(20:00):
give you quotes for that job.
So, one, you know the firstguy's not getting complacent.
And secondly, if somethinghappens to him, you've got two
or three other options.
So you're not the one thenflapping around on Yelp or
Google to try and find the nextelectrician, right?
So I think strength and depth isreally important.
And we talked about sportsbefore we started recording, and
(20:21):
think of it as having a reallygood bench on your baseball
team, right?
Which are not probably as goodas the Dodgers, but we won't get
into that either.
Um, we certainly don't have toget into that, but thank you for
bringing it up.
That's very kind of you.
That's how to run a business,right?
So, again, if you use a goodmethodology, what we use is a
(20:41):
mix of EOS, which isentrepreneurs organization.
Uh, sorry, EOS is uh what's itwhat's the guy's name?
Traction.
Traction is the book, and uhGino Wickman is the author.
It's fantastic methodology onhow to run an organization.
And then if you have a good bookfor the HR stuff and the hiring
(21:03):
stuff is top grading, that'swhat we use.
So we you we use like a mixtureof different things over the
years that we've liked, and thenwe've kind of took the best bits
of other things and kind of madeour own little Frankenstein.
But generally speaking, it's allabout people, right?
Any business that runs well, italways boils down to the people.
And the hard part for me as afinance guy is the people are
(21:26):
not valued on any financialstatement at all.
Yet without them, none of thesebusinesses run at all.
So it's like make sure you havea really good team and a backup
team in place.
Everyone knows what they'redoing, they have really solid
standard operating procedures sothat if one person's off sick or
another person's on maternityleave, that the shit doesn't hit
(21:48):
the fan, right?
Right.
People can step into that and doit.
And then if they've got a greatsoftware like what you guys
produce, then they'll knowwhat's going on clearer and
easier in their business, andthat'll equate to better
financials and better numbersand then better multiples and
better cap rates.
It kind of all stacks on top ofeach other, but you have to have
that solid foundation first.
SPEAKER_01 (22:09):
Yeah, definitely.
Well, we've talked a lot aboutuh the tax side of what it is
that you do, but I want to askyou about your about asset
protection.
This is a term that we've notreally covered on the rent ish
quite yet.
We do a lot of episodes wherewe'll kind of deep dive into a
specific real estate term, butin terms of asset protection,
can you elaborate on exactlylike what that might mean for
(22:29):
someone that's brand new intoproperty management or into into
home ownership or anything likethat?
SPEAKER_03 (22:34):
Absolutely.
So when we look at assetprotection, really what we aim
to do with all of our clients iswe want to make them like a
ghost.
You shouldn't be able to findthese people at all or what
assets they own.
Uh, and that's the best way froma liability standpoint because
here in America, it's such alitigious country, it's
(22:55):
ridiculous, right?
You can sneeze in the wrongdirection and you're gonna get a
lawsuit.
And it's like, what?
I just sneezed, but uh, that'sjust the way it is.
So the way to protect yourself,um, and especially as you're
growing an empire, right?
This is really, really importantto make sure you have levels of
entities, whether they aretrusts, whether they are LLCs,
(23:17):
uh, whether they are whatever itis, it just shouldn't be in your
name directly, right?
Because, and then there's levelsto that.
So if you go down, let's justuse a simple example.
Let's just say one LLC perproperty.
Now make sure that that LLC isin a really good state, like
Delaware, Wyoming, or Nevada,because you don't want your
(23:41):
information to be public toanyone, right, who owns that
LLC.
And you can have a registeredagent and all of those types of
things.
And there's so many companiesout there that do a good job at
kind of pre-building all ofthat.
So you just one click and boom,away you go.
Because if you do get into alawsuit, the first thing these
ambulance chasing lawyers willdo is call an asset search.
(24:03):
They will literally search everydatabase they can see whatever
assets are in your name, andthen they'll assign a value to
that, and then they'll look atthe case and they'll assign a
settlement value to the case.
Now, if that value issubstantial and they can find a
lot of stuff in your name,they're likely to take that case
on.
But if nothing comes back orvery little comes back, they
(24:25):
won't take the case on.
So the person trying to sue youwill not find a good lawyer and
they'll likely lose the case, orthey'll just drop the case
completely because I'm assumingfor your listeners, nine times
out of ten, it's going to be afrivolous case anyway.
And people just trying to shakepeople down.
And we see this all the everyday.
We have a lot of uh doctors asclients of ours, and what
(24:48):
happens is they'll open apractice and they'll open a
second practice, and thenthey'll start getting stupid
lawsuits for like, hey, thisdisabled sign is actually two
centimeters too high, it needsto be two cents, and that caused
me a lot of harm.
So now you have to uh pay me ahundred thousand dollars.
Like you think you might thinkthat's stupid.
It happens here in Californiaway too often.
(25:11):
So you know, you gotta justprotect yourself.
So if that property isn't inyour name and it can't be easily
traced back to you, thoseambulance chasing lawyers will
find a zero settlement value andthey won't take the case.
So uh it's really important fromthat.
And then again, if you'regetting into marriages, let's
(25:31):
say we get this one a lot from alot of our rich clients.
So they're like, hey, I want toprotect my assets from this
person who I may or may not endup marrying.
How do I do that?
And it's like, all right, okay,now we're talking.
So again, we'll show themstructures on do it this way,
because then you never own theproperty.
Because when you when you lookat the mindset of the elite and
(25:53):
the billionaires, they are very,very comfortable with this one
strategy, which is own nothing,control everything.
And you may or may not haveheard of that before, but it's
really, really important.
Own nothing, control everything.
So let's use an example of aprivate jet.
If you don't own the jet, it'snot a big deal.
As long as you can go on the jetwhen you need to, and it can
(26:16):
take you where you want it to bego whenever you want.
Does it really matter if thatjet is in your name, Zach, or
Pat's name?
It doesn't really matter at all,does it?
No.
But regular people get so caughtup on that.
No, it has to be in my name.
I have to own it.
Well, taxation followsownership.
(26:36):
Taxation doesn't follow control.
So if you don't own it, it'sactually in your best interests
not to own it, and it's in yourbest interest to control it.
Okay.
Gotcha.
Interesting.
SPEAKER_01 (26:48):
Okay.
No, well, if Taylor Swift everasks us about her private jet
fleet and needs some advice orwhatever, we'll tell her, we'll
let her know exactly what sheneeds to do.
I bet you send her over.
I can have her hours, but she'sthe guest next week, so it's a
you know good uh good timing.
SPEAKER_03 (27:02):
We'll do that one in person and I'll fly in for it.
SPEAKER_00 (27:05):
Okay, perfect.
I yeah, I'm I'm reallyinterested in all of this.
So do you have like an example?
Do you have an example of likemaybe like a simple strategy
that like you know anyone cansort of understand without
having like a deep knowledge ofof sort of like the tax code and
stuff that has saved like one ofyour clients or somebody you
(27:26):
know like a lot of money, andit's just like a simple thing
that you might not think of.
I'll give you two.
I'll have to achieve.
SPEAKER_03 (27:32):
All right, the first one.
The the first one is for allthose people that are uh
employees, corporate employees,right?
W-2 employees.
So if you've got a job andyou're working for someone and
and it's a good job, so you'remaking a lot of money and you're
paying a lot of taxes.
Again, a lot of our clients arelawyers and doctors, right?
So they fit that mold of makingmulti-six, multi-seven figures,
(27:56):
but it's all as a W-2 salary, sothey are in the system and
there's not many loopholes ordeductions they can take.
So, what they can do is they cancreate a private non-operating
foundation.
I'll say that again, it's a bitof a mouthful.
Private non-operatingfoundation, and what that will
(28:18):
allow them to do day one isdonate 30% of their top line
salary into the foundation, andthey can invest that money
through the foundation.
So let's break that down intowhat that actually means.
Then let's use simple numbersbecause I don't have a
calculator next to me.
So let's just say that a doctormakes one million dollars a year
(28:39):
salary from a hospital.
Usually they'll pay 40% tax inCalifornia, let's say it's 400k.
Now they can donate 300,000, 30%into that private foundation,
right?
So now their tax rate will dropdown to 700,000 rather than the
(29:02):
million dollars.
So 40% is 700,000 as well, 280.
So now instantly they've gonefrom paying 400,000 a year in
tax to 280,000 in tax.
So they've saved 120,000 bydonating 30% to themselves,
effectively, that they stillcontrol in the other hand, and
(29:24):
they can then reinvest thatmoney in a tax-exempt
environment.
So, what does that mean?
So that means now I've justsaved you 120,000 on your right
hand on your day-to-day job,right?
But on your left hand, you'vegot 300k now.
You can go invest in realestate, you can leverage it,
you're only gonna pay a 1.4% taxrate on any income it produces
(29:45):
if it's passive investment.
I'm gonna completely eliminatecapital gains tax.
So let's say we go buy abuilding for a million dollars
and we put down 300,000, right?
Right.
So it's gonna cash flow a littlebit, so we're happy.
So anything that it cash flows.
Flows we pay 1.4% tax on, andnow let's fast forward four
years, and the property'sdoubled from one million to two
(30:06):
million, and we want to sell it.
You pay zero capital gains taxon that.
Wow.
Wow.
All while paying a 1.4% tax ratealong the way.
And now you've got two milliondollars in this foundation.
Go do the same thing, keepgoing.
SPEAKER_00 (30:24):
Yeah, that's so that seems so obvious, but I that's
so interesting.
I never knew about that.
So that's number one.
Let me give you number two.
SPEAKER_01 (30:33):
Yeah, he's like keep going.
All right, I've already hit,I've already hit one ball out of
the park.
Let's see if we can get numbertwo.
You're on a roll, Katie.
SPEAKER_03 (30:43):
Call me Bib Ruth.
Well, actually, Atani is the guyout here now, right?
That is the guy there.
Yeah.
He is the man.
So anyway.
SPEAKER_01 (30:53):
Second Dodgers reference in one single podcast.
I don't know if I can handle it.
SPEAKER_03 (31:00):
And then okay, so the second one is actually more
powerful because it applies toall business owners, right?
So simply put, your net profitthat flows to you is technically
called your AGI in accountingterms.
Let's just call it net profitbecause most people will
understand that, and we don'tneed to get into the tax jargon.
So let's say your net profit isone million dollars again.
(31:23):
We'll use the same numbers.
You can donate 50% of that to alimited partnership.
Now, if people don't understandwhat a limited partnership is,
it's similar to an LLC, S Corp,C Corp.
It's just a type of entity,right?
It's an entity type.
But the difference with alimited partnership is you have
two partners.
(31:43):
You have a general partner thathas power and control, and then
you have a limited partner withno power, no control.
Effectively think of the limitedpartner as a silent partner,
right?
So it's perfect that we have twoof you on.
So let's call Zach the generalpartner, and let's call Pat the
limited partner for thisexample, right?
And now we've got me that's gotthis million dollars that's come
(32:06):
to me, and I'm gonna put 50% ofit into your partnership.
So with that 50% is$500,000that's now in this partnership.
And Zach, let's say you are thegeneral partner but own one
percent, but still have fullpower and control, and Pat,
you're the silent partner, butyou own 99%, but no power, no
(32:30):
control.
The 500,000 is in Zach's hands,and he can do with it pretty
much what he wishes, right?
So let's just say that Zachinvests that in some multifamily
real estate and he grows itbecause Zach's a smart guy, he
knows what he's doing, right?
Thank you for the compliment.
I think someone out there wouldargue that.
(32:50):
Maybe Zach's mother would argue,but nobody else.
But Zach, she's there, so we'llwe'll take a view.
And then now that 500,000 growsto let's just say a million
dollars.
So you doubled your money,right?
Great, you'd have to pay capitalgains tax, right?
If it was, let's say, a propertythat went up in value, or even
(33:10):
if it wasn't, even if it wasjust on passive income that
produced dividends, you pay somesort of tax on that growth,
whether it's annual ordinaryincome tax or whether it's
passive or capital gains, therewould be some tax on that
incremental growth.
But if Zach only owns onepercent of it, then he would
only be taxed on his onepercent, right?
(33:32):
The majority of that tax billhas come into Pat because he
owns 99% of it.
We agree, yeah.
SPEAKER_01 (33:38):
Sounds like sounds like a good deal to me.
SPEAKER_03 (33:42):
It gets even better.
So listen to this.
So what if Pat was a non-profit?
So he doesn't care.
So 490,000, 95,000 can come intopart as a K1, again, technical
terms, but generally speaking,there's a difference between a
distribution and a K1.
(34:02):
Let's get into that first beforewe get into the next step.
So the the that means that that$1 million that Zach's made in
the LP can stay there, it doesnot have to be distributed.
There's no law saying you haveto issue a distribution every
single year or at all, right?
But what you have to do everysingle year is issue a K1
(34:23):
because someone has to pay forthe profit of that business that
given year.
So Pat is gonna pick up 99% ofthat K1, and Zach is gonna pick
up 1% without the money leavingthe company.
The money stays where it is, soZach still has all of the money
in his hand to go play with.
(34:45):
Pat gets a K1 for 99%, doesn'tcare because he's tax exempt,
and then Zach will pay his fairshare of taxes on his 1% and
happily pay that, right, Zach?
Quite happily, yeah.
SPEAKER_01 (34:58):
Call me the happiest man alive.
Yeah, sure.
Wow.
SPEAKER_03 (35:01):
That makes sense.
That's a lot of levels and alittle bit more complex, but
that number two is really wherethe where the rubber meets the
road.
Cool.
Well, that's awesome, Casey.
SPEAKER_01 (35:10):
It's a great way to break it down.
I think it's very clear for alot of people to kind of hear
the visor the visualization ofeverything.
It's been great listening toyour passion about you know
everything that Together CFOdoes.
Uh, I mean, tell us where tellthe audience, not just us, all
the people that are listening tothe show, like where can they
learn more about your guys'company, what you guys are
(35:31):
doing, anything that youbasically like to plug about
together.
SPEAKER_03 (35:34):
Yeah, so uh you can find us.
Our website is togethercfo.com.
We're all over YouTube if youwant to watch some more videos
of me talking.
Uh, and then there's loads of uhInstagram, YouTube, Facebook,
all the rest of that, all thesocials are all together, CFO.
Uh, and then we have a schoolgroup as well.
So school.com forward slash tax.
(35:56):
We have the top 50 loopholes forevery anyone who wants to
actually reduce those loopholesand doesn't need to be in the
top levels, but you know,something for everyone there.
So if you join our schoolcommunity, you get that for
free.
And what I recommend is todownload it, send it to your
CPA, and ask them how many ofthese 50 loopholes are we using
right now?
(36:17):
And then you'll have a list ofwhat you're using.
More importantly, ask for anexplanation as to why you're not
using the others.
Right.
Because if you don't get thattimely and you don't get that
detailed, it tells youeverything you already need to
know about your CPA that youneed to upgrade.
That's like what we touched onearlier, right?
SPEAKER_01 (36:33):
Yeah, yeah.
Grilling the CPAs.
I think we're gonna get a lot ofcomments on this thread about uh
I talked to my CPA and they weredoing what?
They didn't do this, they didn'tdo that, the other.
SPEAKER_03 (36:43):
So gonna be a lot of upset people, but 92% of people
are overpaying, and that's for areason.
So if we can help reduce thatand get some money back in the
people's pockets, then I'm allfor that.
SPEAKER_01 (36:54):
Okay.
Awesome, Casey.
Well, thank you again forjoining us on this episode of
the Rentish Podcast.
It's really been fun to listento you talk and just kind of
hear about your your passion andeverything.
Uh, we'd love to have you backon the show anytime that you'd
love to swing by and hang outwith us.
We have one fun question wealways end the our guest
segments with.
And I've gotten criticism forasking what's your favorite
movie of all time?
(37:14):
Because certain people are like,Oh, I don't know if but is that
easy for KC?
Okay, so perfect.
So best movie of all time.
SPEAKER_03 (37:21):
Gladiator, hands down, Gladiator.
Gladiator.
SPEAKER_00 (37:23):
Okay.
SPEAKER_01 (37:24):
Good pick, Ridley Scott.
Great movie.
SPEAKER_00 (37:26):
I love how you had an answer because most people,
it's like as though they'venever been asked that question
before about what their favoritemovie is.
You know what I mean?
SPEAKER_03 (37:32):
Just one.
There's so many good ones, butwhen when I go back to my
default, Gladiator just has itall, right?
Yeah, it does.
SPEAKER_00 (37:41):
Sweet movie.
SPEAKER_01 (37:42):
Well, what we do on this pod echoes an eternity.
And I've been Zach, that's beenPatrick.
You can find us at the RentishPod on social media questions at
therentish pod.com.
Follow us there, like us andsubscribe if you uh use Spotify.
Give us a five star rating.
If you use Apple, just give usone of those likes or a rating,
whatever they do on that serviceover there.
And then you can comment,download the podcast, listen to
(38:04):
us.
Thank you guys very much forlistening, and uh, we'll see you
next time.
Thanks for having me, guys.
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