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Cashflow Express 2

Cashflow Express 2

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Published by Realty411
Read financial tips and information from some of the leading investment experts today. If you are interested in growing your wealth, be sure to read this latest issue of Cashflow Express.
Read financial tips and information from some of the leading investment experts today. If you are interested in growing your wealth, be sure to read this latest issue of Cashflow Express.

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Published by: Realty411 on Jun 28, 2012
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 Passive Income for Today & Tomorrow
No. 1 / Vol. 2 2012
Continued on pg. 9
How to Turbo-Charge Your Portfolio •
What Type of Investor are You?
 By Ginger Maciaswww.OCWholesalers.com
ow would you like to createyour own “Money List”? Ihave one, and every success-ful real estate entrepreneur I knowhas one. Your money list is simplyyour list of customers who will do business with you on a consistent
and protable basis. This list is your 
most valuable asset in your real estate business. Without it, your business
will not ourish; with it your busi
Find Moneyfor Deals...
Continued on pg. 4
Rehab Tips by the Southern
California ‘Property Flip Pros’
 By Linda Pliagaswww.Realty411Guide.com
t’s not easy to be a flipper in
Southern California. The prices
are steep, the competition fierce,and the deals are few and far between.Yet, professional rehabbers ChristianYepez and Ruth Ortiz not only find away to make it work, but they profithandsomely month after month.Known as the “Property Flip Pros,”Yepez and Ortiz credit their success ontheir many years of real estate educa-tion (they have been attending semi-nars and bootcamps together since
2005). They also acknowledge their 
team consisting of personal and vir-tual assistants, private investors, hardmoney lenders, and other real estate brokers.“We have a lot of real estate agentsand brokers who bring the deals tous because they know we are seriousall-cash buyers,” Ortiz says. “We alsohave assistants who are looking for deals and submitting offer after offer until we get one accepted.”So many offers are made, that they
 Ruth Ortiz and Christian Yepez areknown as the California‘Property Flip Pros’.
 By Deborah Gordon is a real estateinvestment specialist at Invest Arizona
o you are looking for investmentreal estate? If you haven’t already
discovered, you are about to nd
out that there is no shortage of ways to in-
vest in real estate. There is no shortage of 
methods to use. Should I go about invest-ing this way? Should I use this person’ssystem, or should I hire someone to do thework for me?
The laundry list of fac
-tors to consider when in-vesting in real estate seemsendless. But one of the waysyou can cut this list down tosize is to identify the typeof investor you are.Each of us havea differenttempera-ment anda style of decisionmaking.Often times this is the difference be-tween a successful investment and a com- plete disaster.
One of the rst things you should iden
-tify about yourself and your personality iswhether or not you are a “passive” or an“active” investor. Knowing the answer tothis will help you sort out the opportuni-ties best suited for you.I’ve provided a little quiz to help youidentify the type of investor you are andwhat type of investment opportunitiesyou should be looking for.How do you change the oil in your car?Do you A) do it yourself, or B) take it toa shop?If you were to play the stock marketwould you A) look for a strong mutualfund, or B) look for an individual stock that you think has the potential to sky-rocket?What are your investment goals? Doyou want to A) slowly build a stronglong-term investment, or are looking toB) maximize your return as soon as pos-sible?
Do you, A) prefer to nd professionals
and rely on their advice, or do you B) en- joy learning and becoming an expert?What type of property are you lookingfor? A) One that needs little attention atall, or B) one that needs a lot of work?If you consistently chose the letter B,you might be what we consider an ActiveInvestor. An active investor isn’t intimi-dated by much. What the average personmight see as a dilapidated money-pit, theactive investor sees an opportunity to turna little cash and some elbow-grease into a
mini “Taj Mahal”.The active investor sees somethingsexy in turning that xer-upper into a
quick 10%, 20% or even 30 % return. Butthe truth is, being an active investor isn’teasy. On top of the money it takes to buythe right property, it takes a great dealof time, energy and expertise to be successful. Knowing whatto buy, when to buy, andhow much to pay is onlythe beginning. You stillhave to choose what andhow to rehab. Howmuch you willdo on your own. Whatcontrac-tors will be hiredto do what youwon’t or can’t.
This takes an awful lot of effort. The
streets to prosperity are littered with theremains of those who bit off more thanthey could chew. If you don’t believeme, just take a look at how many books,videos or educational products you can
 buy all designed to teach you how to ip
houses, perform renovations or marketyour property.
Being an active investor is denitely a
worthwhile pursuit if you have the time,energy and resources to develop the prop-er expertise.Back to our quiz. If you consistentlychose the letter A, you are probably whatwe would call a passive investor. A pas-sive investor is motivated by a completely
different set of values. The passive inves
-tor may see the opportunities in real es-tate, but prefers to leverage the time, ex- pertise, and resources of a professionalteam/organization.It isn’t that the passive investor is not
capable of ipping houses, or hiring con
-tractors or marketing properties.Let me be clear. It’s not my intention to paint one type of investor as more idealthan the other. Rather, the passive inves-tor has a different perception of the valueof their time. He or she may not have thetime to devote to the process. Or, theymay have the time, but feel that being adecision maker about the investment is amuch more valuable use of their time than
What Typeof Investor 
CashFlow Express 
is published in Santa Barbara County by Manifest Media Partners. ©Copyright 2012. AllRights Reserved. Reproduction without permission is strictly prohibited. The opinions expressed by writers andcolumnists are not endorsed by the publishers and/or editorial staff. Before investing in stocks, bonds, mutual
funds, gold, other securities and commodities and/or real estate, seek the advisement of a trusted nancial ad
-viser, attorney or tax consultant. Investing in any asset and market sector is risky business and may result in lossof capital. Please invest responsibly.
FOUNDERLinda Pliagaspliagas@msn.comEDITORIAL STAFFLori PeeblesIsaac Newkirk IIIStephanie MojicaCOPY EDITOR Anita Cooper PHOTOGRAPHERSSam GreenJohn DeCindisPRODUCTIONLori Peebles Augusto MenesesPUBLISHED BYManifest Media Partners ADVERTISINGManifest Media Partners310.994.1962EVENTS & EXPOSLawrence RuanoWendy Pineda
DISTRIBUTIONProfessional Distribution Solutionsand KJ Banks: 805.377.6328Connect to our virtual network ~ Search for us here:
1 Find Money for Deals1 Tips by the Property Flip Pros2 What Type of Investor Are You?3 Decrease Your Tax Liability6 Commercial Property News8 The Ideal Investment.8 “The ‘How-to-do’ is Easy”10 Stock Market Success11 Practical Solutions12 A Turbo-Charged Portfolio13 Find Cash Buyers14 Publisher’s Tips
Passive Income for Today & Tomorrow
Continued on pg. 7 
Funding Available
for real estate investors
Pacic Private Money makes lending easy. We fund loans on non-owneroccupied single family, multifamily, mixed-use residences, and challengedtownhome or condo projects.We’re fast. We’re friendly. And, we’re ready to help you get the funding youneed right now.
Let us fill you in on all the details
(415) 883-2150
1604 Grant Ave., Novato, CA 94945
California Department of Real Estate Brokers #1897444
CashFlow Express
• Pae 2
CashFlow Express
• Pae 3
veryone needs to file a tax return. However,are you maximizing your deductions while
limiting your tax liability? Throughout the
year, we find that some of the same ques-tions get asked over and over, especially by those inthe real estate industry.
Question 1: What can I do with an investment thatwent bad?
Answer: In the current economical climate, many in-vestors are facing this issue. It is important to planstrategically to deduct the losses from your current taxreturn on either future income or from previous years.
This is called a Net Operating Loss (NOL) carry back.This strategy can generate additional refunds to get
you back on your feet quickly. For example, if youlost $500,000 on investments, the IRS may create a
 Net Operating Loss of $350,000.The taxpayer has the right to carry the losses for 
-ward or elect to carry the losses back two or threeyears. By tax planning, the taxpayer can get refundsfrom prior year taxes or offset future income.With proper planning, taxpayers can turn a bad in-vestment into an opportunity to increase cash flow or reduce future income.
Question 2: Should I have my rentals in an LLC?
A: From a tax standpoint, a Limited Liability Compa-ny (LLC) is a versatile tax entity with many taxation benefits. Based on the tax scenario of the person, theLLC can be a single member, multi-member, or evenelect to be taxed as a corporation.Each option provides a unique set of advantagesand disadvantages. Furthermore, LLCs are statisti-cally less audited than a Schedule E on an individual
return. LLCs also provide a layer of asset protection;
however, we are not attorneys and recommend advis-ing a reputable attorney to plan a strategy unique toyour situation.
Question 3: What are the most audited deduc-tions?
A: For landlords, the most audited deductions are
repairs on a property. The IRS verifies the expenses
that are deducted under repairs that fall within the cat-egory of “wear and tear” on the property, not capitalimprovements. Capital improvements are deductibleover a period of 27 ½ years for residential rental prop-erties.
Question 4: Am I a real estate professional?
A: The requirements are as follows:
1. More than 50% of the individual’s personal servic-es during the tax year are performed in real propertytrade or businesses in which the taxpayer materially participates.
2. The individual spends more than 750 hours of ser 
-vice during the year in real property trades or busi-nesses in which the taxpayer materially participates.3. Real estate has to be over 50% of your time andincome.One tax benefit is the ability to deduct 100% of your rental property losses against other sources of income.
The real estate professional classification can be used
as a power tool to offset income and minimize your tax liability.
Question 5: What activities count towards myhours to be classified as a real estate professional?
A: Well, a real property business is defined as a real property development, redevelopment, construction,reconstruction, acquisition, conversion, rental, op-eration, management, leasing or brokerage trade or 
 business IRS 469(c). This includes real estate inves
-tors who do rent-als, management,rehabbing, whole-saling, retailing,foreclosures, shortsales, commercial, brokerage and manyother types of realestate activities. Inorder to qualify asa real estate pro-fessional there aremany activities thatfulfill the IRS hour-ly requirements and can be easily documented.
 Some examples of these activities are:
Finding Property:
1. Check and review sources for finding investment properties2. Develop a list of bird dogs as sources of good buysand motivated sellers3. Meet with bird dogs as sources of good buys andmotivated sellers
Due Diligence:
4. Do a market/location analysis including emergingor reemerging locations5. Check out specific neighborhoods, perform a neigh- borhood analysis6. Physically go out and search for investment proper-ties
Decrease Your Tax Liability
Tips from Robert Hall & Associates
Continued on pg. 5
By Stephen Hall, E.A. | www.RobertHallTaxes.com

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