In short
How to buy cash-flowing rentals in 2026 despite high interest rates; what job best teaches a new investor; and what to ask a CPA to avoid missing tax savings.
Guests/backgrounds
No guest guests appear; hosts are Ashley Kerr and Tony J. Robinson. They reference investor examples from the BiggerPockets forums and an East Coast investor buying duplexes in Philadelphia.
Key claims
Cash flow isn’t dead, but depends on market, property type, and strategy; don’t use blanket “rates kill deals” advice. Cash-flow expectations have dropped (e.g., Tony’s 30% revenue rule now closer to 15–20%). For learning, prioritize income/time and fit (teacher job vs real estate jobs); acquisition isn’t always required. For taxes, vet CPAs by real-estate client experience; ask about cost segregation/bonus depreciation; discuss entity structure, active vs passive income, and exit/1031 planning; meet quarterly.
Notable examples
Philadelphia duplexes with Section 8 averaging about $1,000/month cash flow; Tony’s property math shift; Ashley’s 2017 purchase rising in value and equity.
Written by AI. May contain mistakes. Listen to the episode to check what was said.
Chapters
Tap a time to open that second in VOListener Questions and Market Challenges
0:45 to 11:10
Discussion on listener questions regarding cash flow, investment strategies, and navigating high interest rates.
“And Ray says, I'm a newbie looking to purchase my first rental property, and I am in need of some advice.”
The Importance of Market Focus
11:10 to 11:57
Emphasis on the necessity of identifying the right market and strategy for successful investments.
“There are two kinds of real estate investors, those who have reviewed their insurance and those who think that they have.”
Job Skills for New Investors
13:22 to 14:01
Discussion on the best job opportunities for gaining skills in real estate investment.
“I'm a brand new investor with little to no real estate experience.”
Finding the Right Job in Real Estate
14:01 to 19:01
Learn how to choose the right job in real estate to maximize your investment potential.
“and a few others, about five or six in total.”
Essential Skills for Real Estate Investors
19:01 to 24:08
Discover the fundamental skills needed for success in real estate investing.
“And, and I think the advice you gave, I would agree with for most people, but there's a caveat to what he said that I think is, is important.”
Understanding Real Estate Taxes
26:43 to 28:04
Gain insights on navigating taxes as a real estate investor and key strategies to maximize savings.
“Banking services provided by ThreadBank.”
Introduction to Real Estate Questions
28:04 to 28:20
Exploring key questions to ask when dealing with real estate professionals.
“I have W-2 income and I own three properties, all long-term rentals that I've had for a few years.”
Tax Planning in Real Estate
28:21 to 28:35
Discussing the importance of tax planning starting January 1.
“And we're recording this right at the end of the year, but this will release at the beginning of the year.”
Choosing the Right CPA
28:36 to 30:45
Key considerations for selecting a CPA that understands real estate.
“But really, you should be thinking about taxes on January 1 for that entire year, not the following year when you're going to file.”
Understanding Tax Structures
30:46 to 33:00
How to structure your entities for real estate investments to optimize taxes.
“So for example, I worked with a CPA for a long time that never ever told me about a cost segregation.”
Show all 11 chapters
Effective Communication with CPAs
33:01 to 35:04
The importance of regular meetings with your CPA throughout the year.
“help you with this, but I know you mentioned the attorney, but also like, you don't have to have one CPA that does everything.”
Transcript
Automatic transcript. May contain errors.0:00Ashley Kehr:What if rising rates made every deal feel impossible? Your cash flow no longer works and you're starting to wonder if real estate investing is even worth it anymore. Or maybe you're brand new and asking, how do I even break into this industry when I have zero experience?
0:15Tony J. Robinson:And when tax season rolls around, what should you actually ask your CPA to make sure you're not leaving money on the table? Today, we're breaking down all three of these listener questions that get to the heart of what Rickies are struggling with right now, financing, experience, and taxes.
0:34Ashley Kehr:This is the Real Estate Rookie Podcast. I'm Ashley Kerr.
0:37Tony J. Robinson:And I'm Tony J. Robinson. And with that, let's get into today's first question. So today's first question comes from Ray in the BiggerPockets forums. And Ray says, I'm a newbie looking to purchase my first rental property, and I am in need of some advice. My main goal going into real estate investing is to gain some cash flow so I can scale down, not necessarily quit my day job, which seemed fairly attainable based on the deal analysis on the site and discussions on the BP podcast. But recently, I've seen several forum posts stating it's no longer possible to have cash flow and that you'll be lucky to even break even.
1:11Tony J. Robinson:Is this true or does it just take more careful planning and knowledge in today's world? I've heard high interest rates are one thing that are hampering cash flow, but my plan was to tap into the equity from our home to cover the first rental, understanding that we could get a better interest rate on a HELOC than with a traditional loan and therefore create more cash flow. Is that correct? Or does it all depend on the LTV ratio on the HELOC as to how low the interest rate will be? The other option is to withdraw money from our Roth IRAs to pay in cash, which would give us decent cash flow on the first property, but we will still need to finance the second, third, fourth, et cetera, through a HELOC or traditional loan and would then face the same question of whether we can find a deal that gives us some as in two to$300 per month in cash flow.
1:53Tony J. Robinson:So I'd like to figure out is cashless an option? And if so, what is the best strategy if that's my goal? Great question. And I feel like there are probably a lot of people listening right now who are thinking about investing in real estate, but are hesitant for a lot of the same reasons that Ray just said, right? They're just hearing a lot of chatter about what real estate investing looks like today. I think first is maybe just have like a quick history lesson. And then, And, you know, Ash, we can both give our take. Interest rates are high right now, right? A lot higher than what they've been, you know, in my adult life, you know.
2:28Tony J. Robinson:And I think a lot of folks, even when BP got started, like BP got started, like right around the Great Depression. And there were a lot of folks who were investing when it was probably one of the best times in the, you know, history of mankind to invest in real estate. But even as the market stabilized and, you know, before COVID, it was still a good time. There are unique challenges today. Inventory is constrained in a lot of places. That's pushing prices higher in a lot of places, and interest rates are making it more difficult. That said, I think any time that we make blanket statements about real estate investing everywhere across every strategy, it becomes a lot harder to say things that are actually true.
3:11Tony J. Robinson:And while some markets and some strategies, maybe it is difficult or maybe impossible to cash flow, there are definitely markets and opportunities and strategies that still work. And I'll give a quick example. I was just talking to a real estate investor last week, and she's based on the East Coast in Jersey, but she buys duplexes in Philadelphia. And her strategy is burying duplexes in Philadelphia and then putting in Section 8 tenants. And she said her average cash flow across those deals, even for deals she's buying today, is about$1 ,000 per month. $1 ,000 per month on a duplex in a C-class neighborhood in Philadelphia.
3:56Tony J. Robinson:So the question isn't, does it work or can I get cash flow? The question is, what market should I be focused on? What strategy should I be focused on? What niche should I be in? And it's the combination of those things that I think will help you find the cash flow. So that's my initial take. Ash, what are your thoughts?
4:12Ashley Kehr:Yeah, I think the combination is key as far as not only your market, things like that, and the property type, but also what other benefits you can get with real estate. Because I think a big comparison right now is, should I invest in real estate? Should I invest in the stock market? And you're not going to get the same benefits like tax benefits, tax advantages, appreciation, things like that, that you would with the stock market. you're just going to get the value of the stock price going up, or maybe you'll get dividends, things like that. But real estate has its own specific benefits. So first, outweigh what other things are important to you.
4:54Ashley Kehr:So if you want to reduce your taxable income, real estate may be a better option for you than the stock market, even if you could get the same return on either one. So I think those are two major investments that you could be looking at to choose between. And I think you have to look at not only the performance in the long run, but also look at the other benefits that you can get from either one. And I like real estate because I believe it has more benefits that benefit me right now in my journey. I want to hold properties for a long time and then sell them way down the road. I want to get the tax benefits right now to decrease my income and keep more money in my pocket now.
5:38Ashley Kehr:So I think looking at that is really important too, is what other benefits do you have your tenants paying down your mortgage? You're not even paying for the property. Appreciation, building that equity in the property, and then just the tax benefits that rental income is taxed different than W-2 income. and being able to use things like the short-term rental loophole or doing cost segregation studies on a long-term rental or short-term rental and also being able to get that real estate professional status for you or maybe your spouse to really be able to decrease your taxable income. So that's something I think you also need to consider when looking at real estate as to like, oh, this is only going to cashflow$300 a month.
6:26Ashley Kehr:But what if that same exact property could actually decrease you not having to pay$20 ,000 in taxes that year? That's almost a little over$1 ,000 a month that you're keeping back into your pocket that you're not paying into taxes. And that's the one thing that took me a long time to realize is this benefit besides just cashflow. So I think take that into consideration too, as to how much money overall can you keep in your pocket?
6:52Tony J. Robinson:Ash, how have your maybe expectations around cashflow shifted, you know, from when you first started investing to today? Cause I think that's a big part of it too. It's just like having realistic expectations around what's here. Um, so yeah, how, how, how, how has that shifted for you?
7:08Ashley Kehr:Yeah. It cashflow was everything. Cashflow was king. Cashflow was how I was going to quit my job. Cashflow was how I was paying off my student loans and for a while it worked. It was great. But like, I realized some of the really great cash flowing properties were headache properties. They were like in classy areas and they needed a ton of just attention. There were headaches, a lot of turnover, things like that. And I realized over time that yes, cashflow is really good and you should not ignore it and you should not buy a cashflow negative property. But there are so many other benefits. Like there's just like, I feel like one day where I just looked at this property I'd bought in 2017 for$143 ,000 and looked at what the rents were when I bought it compared to how much I had been able to increase the rents over the years.
7:56Ashley Kehr:And then what the value of that property was now, like I could probably sell that property for 250 to$300 ,000. The tenants have paid the mortgage down to like 95 ,000. I had put, I think like a 25 ,000 down payment, maybe on it, maybe 30 ,000. and just looking at if I sold that property now, how much money I would get, how much I'm cash flowing on that property. So really though, I was like, I was like in shock when I like had that realization one day, like the aha moment of like, wow, those, you know, 10 years, eight years went really, really fast. And now it's like, okay, if I keep doing that, there's so much more value than just the cashflow.
8:42Ashley Kehr:So again, the cashflow built my strong, steady foundation. And now I can focus more on that appreciation and long-term gain too for the properties. What about you, Tony?
8:55Tony J. Robinson:Yeah. I think for me, just, you know, like my expectations around the type of cashflow that we can get today has definitely shifted. Like, you know, if you go back to like on my wife and I, we have a YouTube channel, The Real Estate Robinson's. And if you go back and you watch some of those earlier videos and we talk about the types of deals we were looking at buying, we typically, you know, like there's a 1 % rule, the 2 % rule in the long-term rental space. And, you know, I have like a 30 % rule where it's like, man, if I can get my annual revenue to be at least 30 % of the purchase price, then it's a really good deal.
9:26Tony J. Robinson:So if I bought a house for, you know, for round number sake, let's say I buy a house for$100 ,000, if I can do$30 ,000 in annual revenue, then it's a good deal. Or a million dollar property does 300K, it's a good deal. Today, that number is probably closer to like 15 to 20%, you know? Um, and it's because rates have effectively doubled since I bought my first short-term rental. Right. So that means that we've got to see the, the returns probably go down a little bit as well. So I think the, the question isn't, should I be investing in real estate or should I not be? The question is, what is the best way for me to do it today?
10:03Tony J. Robinson:And we just, you know, we interviewed, uh, thatch when and James Daynard, uh, as two investors who have been doing this for, for decades. And they both echo the same exact thought. The people who say now is not a good time to buy by people who are probably never going to get started because there's always a reason or some data point that you can point to to say, now it's not the right time to buy, but it's the people who understand that every time it's the right time to buy, it's just adjusting your strategy and adjusting your expectations is how you continue to get ahead. Um, so I get the fear guys and I get the hesitation, but you've got to be able to separate who you're taking advice from.
10:40Tony J. Robinson:And if the folks who, who are telling you don't buy real estate are people who've never bought real estate, uh, or maybe people who have done it without the proper guidance and education, and they're not really part of the bigger pockets ecosystem. And they're not actively doing this. You got to kind of filter that, that advice out. So, um, yes, now is still a good time to do it. You just got to figure out the right way to do it.
11:01Ashley Kehr:So if you can't make the math work yet, what if your day job was your turning count? After the break, we'll talk about which jobs actually teach you to invest smarter. We'll be right back.
11:11Tony J. Robinson:There are two kinds of real estate investors, those who have reviewed their insurance and those who think that they have. Most don't realize their coverage wasn't built for how they actually invest. Vacancy periods, rehabs, short-term rentals, or LLC-held properties. These gaps surface only when filing claims. That's why investors work with NREG. They specialize exclusively in real estate investors, understanding portfolios, risk at scale, and cash flow protection. One claim can erase years of returns. If you own a rental property, don't assume you're covered. Have NREG review your insurance with someone who gets investing at nreg.com slash bppod.
11:42Tony J. Robinson:That's n-r-e-i-g dot com slash bppod. For decades, real estate has been a cornerstone of the world's largest portfolios. But it's also historically been sort of complex, time-consuming, and expensive. But imagine if real estate investing was suddenly easy. All the benefits of owning real, tangible assets without the complexity and expense. That's the power of the Fundrise flagship fund. Now you can invest in a$1.1 billion portfolio of real estate, starting with as little as $10. The portfolio features 4 ,700 single-family rental homes spread across the booming sunbelt. They also have 3.3 million square feet of highly sought-after industrial facilities, thanks to the e-commerce wave.
12:23Tony J. Robinson:The flagship fund is one of the largest of its kind. It's well diversified and it's managed by a team of professionals. And it's now available to you. Visit fundrise.com slash bpmarket to explore the fund's full portfolio, check out historical returns, and start investing in just minutes. Carefully consider the investment objectives, risks, charges, and expenses of the Fundrise flagship fund before investing. This and other information can be found in the fund's prospectus at fundrise.com slash flagship. This is a paid advertisement. If the new year means getting rentals back in order, listings are a good place to start.
12:51Tony J. Robinson:Avail, part of Realtor.com, makes it simple to list a rental for free and get it in front of millions of renters. One listing, one click, posted across 24 top rental sites. Avail even helps generate listing titles and descriptions to save time. More visibility means fewer days sitting vacant and getting your property rented quickly. It's a fast, free way to find renters without the usual hassle. Get started at avail.co slash biggerpockets. That's A-V-A-I-L dot C-O slash biggerpockets.
13:19Ashley Kehr:Okay, welcome back. Our next question is from Taylor in the BP forums. I'm a brand new investor with little to no real estate experience. My wife and I are moving back to Birmingham this summer, and I am planning to invest in real estate when we do. In your opinion, what is the best job that will teach me the skills necessary to be a real estate investor? Little background, my wife is a high-income professional in the medical field, and I am an educator. Our plan is for me to leave the teaching field and invest in real estate full-time when we return to Birmingham this summer. I don't have any work experience in real estate, but I started reading and trying to learn what I could back in 2020.
13:59Ashley Kehr:I've read a few of Brandon Turner's books and a few others, about five or six in total. So I would like to obtain a job in real estate where I could work full-time while we begin buying rentals. Our initial strategy is to buy single-family homes for buy and hold long-term rentals in or around Birmingham. We're looking at buying at least one home per year for the next 10 to 15 years. I assume our plan can and will evolve over time as we are interested in small multifamily as well. So back to my question, what would be the best job for me to gain valuable experience? After a little online research, it seems something in acquisition so that I can learn to analyze deals or property management so that I can learn the day-to-day operations.
14:39Ashley Kehr:What would be the best position? Thoughts. I actually have a hot take on this, I think. Yeah. Ooh, Ash has got a hot take.
14:45Tony J. Robinson:You mean like a hot take, you know, sound effect or something.
14:50Ashley Kehr:I don't think that's what you should be concerned about. I don't think that you should worry about that. I think you should take the highest paying job to increase your income, to increase the amount of money you have to invest in real estate. And also that gives you the time to invest in real estate. So I would say being a teacher, okay, if you were to keep, you know, a teaching job, teachers can be well paid I will say it's not the highest paying job for the amount of work that they have to do but you're working school hours you're getting vacation days off you're you know over holidays you're off during the summers so if that is like a better paying job than working at a property management company where you're working 40 hours a week for the whole time throughout the year, maybe keeping a teaching job is actually the better solution for you.
15:47So I think the reason I
15:50Ashley Kehr:think that is because you don't need to learn a skill set to actually invest. I do think it is very valuable to get paid to learn. That is how I started. I worked as a property manager for an investor and I learned everything and felt it definitely gave me the confidence. But I don't think that you need to do that or that it's going to set you apart than someone who isn't doing that. I think you are still as capable of learning everything online at your home without actually physically working that job. If you are set on getting a job that's in real estate, I would say not a real estate agent.
16:37Ashley Kehr:It's not consistent enough. You're going to most likely be 1099. It's not going to help you get loans for investment properties. Property management, unless you're in a lot of states, if you're not a licensed real estate agent, you can't actually be like a property manager. But working in the office, you'll have access to lease documents, things like that. What I would suggest instead, instead of getting like a full-time job, I met someone who went and worked as one of the, I can't think of what it's called, but they would like be the person that answered the phone for work orders and assign the work orders to people.
17:18Ashley Kehr:And so they'd move to their full-time job to do that. What I think what you could do instead is keep your consistent job as a teacher. Maybe pick up a shift a night or on weekends leasing an apartment or doing maintenance on a property. I had met a sheriff before who he, as a part-time job, would do maintenance on properties. The investor that owned the properties would text him. This was before there was great property management software. or text him, here's the work orders that need to be done. And then he would schedule them and set up times that worked for him to go and meet the tenants and complete the work orders.
18:00Ashley Kehr:So I would say, like, if you can get paid more money to switch careers into something that's, like, in the property management field, even project management, usually you need to have some sort of, like, experience or a project management degree to get into a field like that. It can be super beneficial, especially if you're going to be doing rehabs maybe even in construction, you know, working for a builder or something like that, where you're learning more about the rehab process. But I would say my recommendation would be to keep whatever job is going to be consistent income for you and that you enjoy too.
18:38Ashley Kehr:Property management, you just hear complaining all the time. It's not enjoyable. And then try and pick up something on the side or just your part-time job is going to be just mentor, shadowing an investor or something, not even get paid to do it. So I think there's many other options rather than just like completely switching careers.
18:58Tony J. Robinson:Ash, I'll, I'll agree with you, but I'll also disagree with you. And, and I think the advice you gave, I would agree with for most people, but there's a caveat to what he said that I think is, is important. He said, my wife is a high income professional in the medical field. So it kind of sounds like his wife is able to hold it all down for like what they need for their life and everything. So I actually do think that in that unique situation, him going and taking a very, you know, kind of riskier job in the real estate space might actually be a really good idea. And for me, I feel like most investors, like if I was in his position, I would try and go find like the biggest wholesaler in my market and go work for them so I can understand how to build deal pipeline, like how to build my pipeline of deals.
19:46Tony J. Robinson:Because whatever strategy you end up wanting to go into, the ability to find a good deal is foundational to being able to execute. It doesn't matter if you're flipping, long-term buy and hold, short-term, mid-term, whatever, name it. You still need a good deal in order for these deals to work. So I think only because he's got this spouse who's a high-income earner, it seems like take care of everything. I would invest all of my extra time, effort, energy into getting really, really good at finding the best deals and then scaling up from there.
20:18Ashley Kehr:If you guys are watching this on YouTube, let us know in the comments which way you would take if you were this person. Or if you totally disagree with both of us and have your own solution, let us know in the comments. Right.
Read the full transcript
20:31Tony J. Robinson:So from your perspective, if you think about all the different pieces that go into like making a real estate transaction happen from acquisition through management and everything in between for a rookie, which one do you think they should focus on most or first? maybe?
20:47Ashley Kehr:That's a good question. I do think that acquisition piece is important, but I do think there's so many investors that are successful that don't have to acquire a property from scratch. You can use a real estate agent to walk you through that process, to find a deal for you, to help you with all that, or you can buy from a wholesaler. I think it really depends on the person and what their goal is in real estate and what they want to actually get into. Like I have no interest in going and soliciting off-market deals by cold calling or texting or door knocking. So I mean I wouldn't take the time to learn how to do that.
21:32Ashley Kehr:Like I've sent mailers before. I do a lot of off-market deals just from referrals, things like that. But I am not physically out there soliciting deals. So I think that that makes a big difference that it's not useful for me to learn too much into how to spot a motivated seller, things like that. I definitely do think it's a big thing and probably can propel you and 10X you and get you better deals. But I don't want to put the time into that. So I don't know what I like for me, property management definitely was really useful. I think it gave me like the confidence of like not being scared of, you know, actually managing the tenant and knowing what to do and things like that.
22:15Ashley Kehr:But actually, you know what? I'm changing my mind. I know it'd be the best thing. Handyman skill set. That I think would be the greatest, one of the greatest things if I was getting started. Cause I think that's like one of the biggest, not feeling confident about doing the rehab on the property and not feeling confident about getting maintenance things. So that's, that's what I would do.
22:37Tony J. Robinson:You know, I was, I like the handyman idea, but I think your, your initial point ashes is maybe even more important because what you're basically saying is you've got to understand who you are as an individual, where your natural kind of skills and abilities lay. And what, what do you really want to focus on as you become a real estate investor? Cause you're right there, there are successful real estate investors who do just use, you know networking with agents and wholesalers to go out there and find all their deals so they can focus on the other element so i i guess you've got to ask yourself what part of that you know cycle of a deal do you really want to be be focused on and build your expertise in and then probably go go do that so yeah it's a great point ash i guess the answer does kind of vary
23:23Ashley Kehr:depending on the the unique individual and like for me it was property management but also like It's so easy to hire a property management company. So if you already know you're going to do that, it's not worth your time. So maybe asset management is the best answer, knowing how to manage your assets.
23:40Tony J. Robinson:You know, like for me, I'm good at property management, but I don't like it. You know, like I do not like being a property manager. That's why my wife handles most of the day-to-day in our real estate business. But I do like underwriting deals and, you know, kind of building that pipeline and doing that piece first. So yeah, I guess it does kind of depend on where your skill sets lie.
23:58Ashley Kehr:I have to say for short-term rentals, I do not like it either until I finally grew up and got like good property management software. And now that I use House Fittable, I love it because it like does everything for me. So I like feel like I'm so accomplished as a host of my rentals now, but literally just because it's doing all everything for me.
24:22Tony J. Robinson:Shout out to the right tools. So guys, DM me and Ashley on Instagram if you want all the tools that we use because it makes a big difference in being able to run both your long-term and your short-term rentals the right way. So there's plenty of them out there.
24:33Ashley Kehr:And again, if you're watching on YouTube, tell us your favorite tool for investing because I am obsessed with software, apps, anything that will help me run my business. So I'd love to see what are some of your guys' favorites.
24:46Tony J. Robinson:All right, guys. So we talked about where to get started, but what happens when you actually find the deal? At some point, you've got to pay taxes. So how do you navigate the world of taxes as a real estate investor? We'll cover that right after we're from today's show sponsors.
25:02Tony J. Robinson:Tired of traditional lenders holding you back? Host Financial is here to change the game. They've ditched the DTI restrictions and they zero in on what really matters, your property's income potential. So no more chasing papers for tax returns or personal income statements. Think about it. A lender that values your property's worth over your paycheck? That's the Host Financial difference. Approved in 47 states, they are ready to help you make your next big move. Curious if you qualify? Just head over to HostFinancial.com and find out. Stop letting outdated lending practices hold you back. That's HostFinancial.com, where your property's potential meets unlimited financing.
25:37Ashley Kehr:You just realized your business needed to hire someone yesterday. How can you find amazing candidates fast, easy? Just use Indeed. When it comes to hiring, Indeed is all you need. That means you can stop struggling to get your job notice on other job sites. Indeed's sponsored job posts help you stand out and hire the right people quickly. Your job post jumps straight to the top of the page where your ideal candidates are looking. And it works. Sponsored jobs on Indeed get 45 % more applications than non-sponsored posts. The best part, no monthly subscriptions or long-term contracts. You only pay for results.
26:12Ashley Kehr:And speaking of results, in the minute I've been talking to you, 23 people just got hired through Indeed Worldwide. There's no need to wait any longer. Speed up your hiring right now with Indeed. And listeners of the show will get a$75 sponsored job credit to get your jobs more visibility at Indeed.com slash rookie. Just go to Indeed.com slash rookie right now and support our show by saying you heard about Indeed on this podcast. That's Indeed.com slash rookie. terms and conditions apply. Hiring indeed is all you need.
27:11Tony J. Robinson:and is not an FDIC-insured bank. Banking services provided by ThreadBank. Member FDIC. Tax season reminder for all the real estate investors listening. If you own rental properties, short-term rentals, commercial buildings, basically anything that's not your primary residence, you need to know about cost segregation. It's an IRS-compliant strategy that lets you accelerate depreciation on your properties, which means you're paying less in taxes this year and keeping more cash in your pocket for your next deal. Cost Segregation Guys is the go-to firm, having done over 12 ,000 of these studies with$500 million in total depreciation identified.
27:48Tony J. Robinson:Head to costsegregationguys.com slash BP to get a free proposal and see your potential tax savings. All right, guys, we are back with our final question of the day. And this one comes from Daniel in the BiggerPockets forum. And Daniel says, I'm looking to hire a professional to help me with my taxes this year. I've always done them myself, but I fear I'm leaving money on the table. I have W-2 income and I own three properties, all long-term rentals that I've had for a few years. Are there any questions that I should be sure to ask or anything that maybe you wish you had asked sooner? Looking forward to hearing from you guys.
28:20Tony J. Robinson:All right, this is a great question. And we're recording this right at the end of the year, but this will release at the beginning of the year. So it's actually a great time to talk about taxes because I think a lot of people wait until that spring deadline to start thinking about taxes. But really, you should be thinking about taxes on January 1 for that entire year, not the following year when you're going to file. We got our first CPA, not at our first deal, but it was within like the first, I don't know, 12 months or so. Because by the time I filed my first tax return as someone who had several properties, I did have a good CPA that I was working with.
29:00I think the first thing, and Ash, let me know if you disagree with this.
29:03Tony J. Robinson:I think the first thing that you should ask whatever CPA you go work with is what percentage of your clients own real estate? And you don't want to get into a position where you're educating your CPA on things like bonus depreciation or cost segregation studies, um, or, you know, different deductions you can take as a real estate investor. So I, for me, I think that would be my first question when I'm going to vet someone as my potential CPA is not do you work with real estate investors, but what percent of your client base right now are in real estate?
29:38Ashley Kehr:I think that's a great question for any vendor. If you're looking for an insurance agent, if you're a real estate agent, how many investors do you work with? I think that's a great thing. even contractors, like a contractor that I've used a lot, he really only does stuff for investors or he has his own investment property. So he's very like conscious that like, this is a rental. This isn't like my dream home and we don't need to go over the top with finishes and things like that. So it really can make a big difference. With using a CPA, I think there is some level of knowledge that you need to have.
30:22Ashley Kehr:Like, of course, you want to hire the right people so you don't have to learn all of these things. But BiggerPockets does have a couple books on tax strategies for real estate investors by Amanda Hahn and Matt McFarland, which I think are a great read just to give yourself the basic knowledge. So that way, when you are going to your CPA, you have some knowledge about what they can offer you and also to be able to ask these right questions. So for example, I worked with a CPA for a long time that never ever told me about a cost segregation. Now I know to ask how many cost segregation studies have your clients done, you know, in the past year or have you, you know, you've done on their tax return or whatever.
31:08Ashley Kehr:I think that just having that basic knowledge of what opportunities, tax loopholes, deductions are out there can really, really help you have that conversation with a CPA to see if they are a right fit. Because if they don't know what some of these things are, that's probably a red flag.
31:28Tony J. Robinson:I think another one for me to call out is like your, your entity structure. And it's good to give advice both from a CPA and an attorney on this one, because they're both trying to optimize for different things. But I'll give you guys like, like an example. The first CPA that I hired, we were flipping homes and we're holding real estate and we were doing it all together. And she's like, no, no, no, no, do not want to do that because I can't remember the reason, you know, like something about, you know, employment taxes or something. And it's like, you're getting double tax if you're, you know, running, you know, uh, active income through a passive income entity, like it doesn't work.
32:00Tony J. Robinson:So she encouraged us to split it out. So now even to this day, we have one entity that we hold all of our real estate in, right. So all of our buy and hold rentals are in one, anything that we flip or any of our other active income is in a separate entity. and there was a tax advantage to doing that and she was able to share that with me so I think just sharing with your CPA what are your current you've got three rentals right now but are you doing anything active do you flip as well do you wholesale do you have any other active income that you're doing to make sure that they can give you some some insight there um I think another one that's important too is um just like exit strategies because sometimes maybe you're thinking about selling a property and just having that conversation with your CPA beforehand so they can give you advice on, okay, you bought it for this much.
32:42Tony J. Robinson:You actually depreciated this much already. You know, if you sell this, here's what you're kind of looking at from a tax perspective, but if you 1031 it, then, you know, here, here's the benefit of doing that. So I think just keeping them in the loop about not only where you are today, but what your plans are for the future. So they can give you advice on how to make the right moves.
33:00Ashley Kehr:And you can also have two people help you with this, but I know you mentioned the attorney, but also like, you don't have to have one CPA that does everything. You can have a CPA that files your tax return and you could have a different CPA that does your tax planning that helps you with this going forward. So like they're the ones that are really focused on like what moves you need to be making, knowing what you're going to have happen so they can have you do the right things before the end of the year so that when you do go to file your tax return, you have all of the information that you need for the other CPA to put onto the tax return.
33:42Ashley Kehr:And I've actually found this to be cheaper, kind of, is to not have the really skilled person do all of it, where they're doing the fine-tuning, they're putting it into a package for me of how this is going to be the best tax strategy. And then basically, I'm giving the other CPA the fill-in-the-blank information on my tax return. Cause that's what a tax return is. It's fill in the blank. And then, you know, each year the tax planner actually reviews, make sure it's correct, things like that. So that's another thing too, is you don't have to rely on just one person. And it really helps having two people, because if there is something that one person brings up, you can talk to the other person about and see what actually is the best benefit to you.
34:26Tony J. Robinson:That's true. That's actually how we started as well. We had someone for tax strategy and someone else who's doing the actual preparation for us. I, and on On that note, then I think the other question you should ask the CPA as well is like, how often are we meeting throughout the year? Like, am I just meeting you, you know, like the first week of April, you know, when I sit down with you to do everything or are we meeting multiple times throughout the year? And ideally, probably like a quarterly cadence, I think is good for you and your CPA to meet to make sure that they can stay up to, you know, up to speed on what you're doing throughout the year and help you plan to make sure that by year end, you've done everything within that calendar year to optimize that year's tax.
35:03Tony J. Robinson:returns. Because if you're, you know, if you're, it's 2027 and you're now filing your 2026 taxes, well, if you're sitting down in, you know, April of 27, it's too late to really change much about 2026. So the goal is that throughout 2026, throughout that year, you can make those changes, make those decisions that will make that tax prep in the next year a lot easier. So I think that's an important one as well. How often are you guys going to actually meet?
35:28Ashley Kehr:Well, thank you guys so much for joining us today on Ricky Reply. I'm Ashley. He's Tony. And we'll see you guys on the next episode. At some point, your little real estate side hustle stops feeling little. Rent's coming in. Maybe you've got a couple properties now and suddenly the money part gets real. Your tax bill's going up. You're Googling LLC versus S Corp at midnight. And you're just hoping you didn't miss something that'll cost you later. That's where Collective comes in. Collective is the first all-in-one financial solution built exclusively for solopreneurs, saving you time and money.
35:58Ashley Kehr:They help you structure your business for success, whether that's forming a single member LLC or adding an S-Corp election. Collective's AI engine, backed by expert oversight, automatically categorizes every expense so you never miss a deduction. Beyond bookkeeping, they handle quarterly tax estimates and prepare both your business and personal tax returns, so you never miss a deadline. You'll also get integrated invoicing plus seamless payroll for S-Corp owners, which can unlock thousands in self-employment tax savings. And with Collective's community and support, you can finally take the solo out of solopreneur.
36:29Ashley Kehr:Right now, Collective is giving you 50 % off your first two months when you go to collective.com slash rookie. That's 50 % off your first two months at collective.com slash rookie.
36:38Tony J. Robinson:Hey, rookies, if you're watching this, we want you to apply to be a guest on the Real Estate Rookie Podcast. That's right. Ashley and I are looking for amazing stories just like yours to be a part of our Real Estate Rookie Podcast. Now look, you don't need to be an expert. You don't need to have done thousands of deals, even if you've done one deal, your story could help inspire the next listener.
36:56Ashley Kehr:As a rookie investor, especially if you just got your first deal, it is all fresh in your minds and you are the best person to tell your story, give your experience on how you got it done to help someone else get their first deal.
37:09Tony J. Robinson:So head over to biggerpockets.com slash guest. If you want to be a part of our show again, that's biggerpockets.com slash guest. And we'd love to have you on.
From the publisher
Is real estate investing still worth it? High mortgage rates and home prices can make buying a rental property seem challenging, if not impossible at times, particularly for a rookie investor with zero experience. But not to worry—in this episode, we’re sharing beginner-friendly tips that will help you find and fund cash-flowing deals in 2026!
Welcome to another Rookie Reply! We’re back with three questions from the BiggerPockets Forums, the first of which comes from someone who’s looking to break into real estate but is unsure of how to make the numbers work in today’s high-interest-rate environment. Is now a bad time to invest, or conversely, the best possible time to get started?
Another investor is looking to leave their W2 for a job in real estate, but should they? Ashley and Tony debate whether this move actually gives you an edge. Finally, behind every good real estate investor is an investor-friendly tax professional. But how do you find one? We share some of the most crucial questions to ask when hiring a CPA!
Looking to invest? Need answers? Ask your question here!
In This Episode We Cover
How to find cash-flowing real estate deals (despite high mortgage rates)
Whether rookies should start investing in real estate in 2026 (or wait)
Choosing the right investing strategy for your long-term goals
The BEST real estate jobs to help fast-track your investing journey
When to leave your current W2 job for a job in real estate
Crucial questions to ask a tax professional before hiring them
And So Much More!
Check out more resources from this show on BiggerPockets.com and https://www.biggerpockets.com/blog/rookie-664
Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email advertise@biggerpockets.com.
Learn more about your ad choices. Visit megaphone.fm/adchoices
