Ep. 32 | Legal Insight Into Short-Term Rentals (STRs)
Download MP3Welcome to the Teaching Tax Flow podcast, where the goal is to empower and educate you to legally and ethically minimize taxes paid over your lifetime.
Speaker 2:Hey, everyone. Welcome back to the podcast episode 32. Today, we're gonna dive into some of the legalese, we can say, regarding short term rentals. So those SDRs, that acronym that we all love so much. Be ready for this show here.
Speaker 2:We we dive into some of the nitty gritty, we should say, but it may be a huge eye opener for anybody that's ever managed a short term rental property such as those on Vrbo, Airbnb, any of the other platforms. But there's some great information. So, be ready to jot down some of these notes. Fantastic guess as always, as I always like to say. But again, we're gonna dive into some issues with this or potential issues or challenges, I should say, that you may never have considered before.
Speaker 2:But before we jump into that, as always again, let's take a moment and thank our sponsor. This podcast is brought to you by Strategic Associates. Are you a high income earner, real estate investor, or successful entrepreneur who is frustrated by having to pay $75,000 or more of annual tax liability? If so, Strategic Associates can help. Your first step to saving thousands, if not hundreds of thousands, is to contact Roger Roundy at roger@strategicag.net or by calling (801) 641-2956, and be sure to tell them TTF sent you.
Speaker 2:Hey, everybody. Welcome back to Teaching Tax Flow, the podcast. I'm John Tripalski. Here as always, can't get rid of me that easy, and we still got this other guy here, across the screen from me. We're doing this virtually.
Speaker 2:But but who are you? We call you the big bald guy, but I I guess you're kinda smart. You know what you're doing. What's your name?
Speaker 3:I've been called a lot worse. You know that. And, yeah, it's tough doing this virtually, John. I'm used to being, your right hand man, but Chris Pacuro here with Teaching Tax Flow, and we are both very, very excited to talk to our guest this week. It's someone I had to I had to pull some strings together.
Speaker 3:I had to do some begging. I but but but it it end up working out. Hey.
Speaker 2:And you know what, Chris? Before we introduce him too, I I know I like to harass you a little bit, but I promise not to talk about a couple topics. You know? You know what? I'm not gonna say them.
Speaker 2:I'm gonna behave myself this time. I know what I know which ones are your hot buns. I'll leave those in the box for later. Anyways, cutting to the chase, great topic as always. I know I say that every single time, but I really do mean it.
Speaker 2:Once again, like, every single time, if you want a short term rental or you're even thinking about it excuse me. See, I'm getting choked up thinking about this. You've gotta talk to these guys or this guy specifically. We'll just call him Jeff Hampton. It's a pretty pretty good name for this guy.
Speaker 2:Actually, the owner and the managing partner of STR LawGuys. So if that doesn't say what they do, you got bigger problems, they do stuff with STR. Jeff, how are you doing, man? I'm doing great.
Speaker 4:Thank you guys for, for allowing me to join all today. I'm excited. Hey.
Speaker 2:You know what? I maybe you're a victim of this, so just me and Chris going back, harassing each other, but we'll, we'll air on the side of that that you actually wanna be here. Thank you for taking the time to join us. And, obviously, STR, so short term rentals, for those that aren't familiar with what STR means. Walk us through a little bit about, you know, what you guys do, how you got into this a little bit, maybe a little bit of your personal background, but really just, you know, giving us a couple nuggets that if somebody's looking to get into this or, you know, how they can contact you, let's start from the beginning.
Speaker 4:Absolutely. So first thing is, you know, listen, short term rentals are an amazing asset class to be involved in. I mean, I can tell you, you know, having been invested some in long term rentals and just having some familiarity with real estate, once you get into short term rentals and you understand that cash on cash return, the cash flow, all that's available to you, and not to mention the stuff you guys are experts in, which is all the tax benefits that are associated with it. It's a pretty exciting asset class. But for me, I've had the opportunity to work, within this space, certainly over the last year with great people in the in the space like Mil Faith and Mike Shilohren and some of these other influencers that really helped open my eyes as well to even more opportunities within the short term rental space.
Speaker 4:And so I can tell you my background's a little unique when it comes to this. I have scaled a couple of other law firms in the past, and one of those was a personal injury law firm. And we spent our time bringing lawsuits against short term rental owners, long term rental owners, commercial property owners. So, one of the things that we did is we would bring assessed liability lawsuits against people. So, I've been in the courtroom, and I used to be a, I used to actually be a former prosecutor.
Speaker 4:I tried everything from misdemeanor cases to capital murders. And so, one of the things I spent a lot of time doing was litigation. So, I had a kind of, you know, a little bit of a unique perspective, of understanding what works in a courtroom when you're potentially looking at a lawsuit. So, for me, it was a natural extension for me at S tier Law Guys. I founded S tier Law Guys once I started in my journey in venture capital investing.
Speaker 4:I partnered with my current partner, Steven Tobin, and him and I formed best here at The Law Guys. And, generally speaking, here's what we provide. We provide asset protection for all types of short term rental, everything from co hosting to arbitrage models, as well as ownership, partnership arrangements. And now people are going to a lot of into a lot of unique areas like boutique hotels, whether they're they're taking new hotels and converting them now into short term rental arrangements, which is really I kinda joke about that. I see that as more as commercial real estate.
Speaker 4:But, you know, all the STR people don't tell them that. Right? So but the reality of it is that's kind of the direction we're headed, but we also do more than that. We also help people make sure there are a lot of retail investors out there in the short term rental space that don't know, do they really have the right kind of insurance? They haven't even thought about making sure they have the right type of agreement.
Speaker 4:Are they protected? And we're a huge believer in what we call layered asset protection strategies, which means one thing by itself is not enough. You have have to make sure you layer up your protection. And we have kinda created that mindset of let's check the box of each layer. And the the more you here's the general rule, that the more of your net worth you're placing in the short terminals, the more you need to layer up so that you're less
Speaker 2:of a target. Absolutely. Absolutely. So so really just kind of bringing it up to it and maybe this will dive into a little bit more about some of the services y'all offer. And then of course, we'll reel in some of the tax knowledge.
Speaker 2:Of course, we'll drop those nuggets in there. But you did mention you know, obviously, we're talking about STRs, you know, the short term rentals, and you you mentioned insurance as one of those. Yeah. I mean, I was an Airbnb Airbnb host for a while. It actually helped me bootstrap one of my companies, well, feeling old, twelve years ago, now fifteen years ago.
Speaker 2:And and it seems like you're big guys. You know, your Airbnb, I don't know if VRBO or Vrbo does it specifically. But now, you know, I'm a marketing guy, so naturally, I I take in their content a little bit differently maybe.
Speaker 4:Sure.
Speaker 2:But they really have on the forefront the the insurance that they offer. And I and I know there's a lot of horror stories around that as well too, so I'm sure you have a unique perspective on that.
Speaker 4:Yeah. So look. That's a really good question. I have a lot of owners that'll come to me and say, do I really need much of my own personal insurance coverage for my properties? Because, you know, I've got air cover with Airbnb.
Speaker 4:Right? Air cover is gonna cover me. VRBO's got this policy where you can extend based upon a certain amount per stay where they have to pay through a certain amount on the deductible. And and look, you should do those things. There are those are good things, and I I I applaud Airbnb for providing some coverage.
Speaker 4:But you're really on someone else's platform. And the reality of it is, you know, it's your property. You own it. You're trusting a third party to help provide you protection in the event of a lawsuit. And the reality of it is they're great for repair type things, things that are broken.
Speaker 4:They're usually very good about placing those. But if someone gets hurt seriously, then one of the things that happens is people start clawing fingers at each other. And, I tell people it's super important that you check your insurance policy because you cannot just trust on airconvert or VRBO's insurance policies to protect you in the event of life.
Speaker 2:It's almost like making the assumption if you're an Uber driver. And, Chris, I know we've mentioned Uber drivers all the time. I'm gonna have them so much. They keep us out of trouble. I know that's a big thing in in that space.
Speaker 2:Right? I mean, not just divert, but people say, oh, you know, I'm gonna I'm gonna drive for Uber. And then all of a sudden, you know, they basically have no mention of it, being used as such an auto one policy. They get an accident. Somebody, unfortunately, passes away in Absolutely.
Speaker 2:Trouble.
Speaker 3:John, it's good it's good that you had not met Jeff based on his criminal, defense background, first of all.
Speaker 2:Well, maybe maybe we did. Maybe we maybe we crossed paths or god. I can't even talk. Easy now. Easy now.
Speaker 2:My wife might listen to this. That was that was pretty weird.
Speaker 3:One thing I love about Jeff and the STR Law guys is that we someone someone smart told me this once. I wish I knew whoever it was. Must have been too long time ago. But they said, always always find people that make complicated things easy. And then people that seem to make easy things complicated, stay away from those people.
Speaker 3:Don't do work with those people. So one thing I do like is that the STR law law guys are making things simple. And and layering that insurance or risk management is important because I think that, obviously, teaching tax law, we we do have a lot of real estate investors in in the community. A lot of them have taken advantage of what we call short term rental loophole. In part of taking advantage of the short term rental loophole is being having a concept, and we don't wanna go too technical, but concept of material participation so that you can you can take paper losses from a from a rental property and and you're typically, you're self managing it.
Speaker 3:So when you're self managing a property, obviously, your asset protection layering might be different. But one thing that I think that we and we have a lot of clients to do this that that we have to consider is that you you could have, you could have exposure, legal exposure without even owning a property, and you could be a cohost. So that's something that I, Jeff, maybe you can mention. Things to consider for a cohost, maybe what a cohost is and and different than someone that self manages and then maybe different from someone that's more hands off from a third party. What's similar about their their protection layering and what might be unique?
Speaker 3:Just from a 30,000 foot view.
Speaker 4:Yeah. A really good point. And co hosting is really popular now because, you know, things have slowed down a little bit within the acquisition stage of short term rentals because of the increase in interest rates and different things like that. And and so a lot of people are using co hosting as a way to create this jet fuel for more investment. They can create money by essentially the way it works is, let's say you go to an owner.
Speaker 4:You've got an owner right now who's maybe not very sophisticated. They're not exactly sure. They're trying to figure out how to do this stuff on morale. Or maybe they're using nothing against some of the larger property management companies that are out there, but a lot of these property management companies are not doing a great job. They're they're usually traditionally lower on their review or their five star review counts.
Speaker 4:They're not always giving that real touch, that personal touch of hospitality. So, very experienced owners or co hosts who know what they're doing can come in and assist. They can co host with the ownership and they come in there, they basically jump in there and help out with the messaging. They they help optimize their listings, they can help them out with the marketing piece. They can really educate, but at the same time, this really works well with doctors and lawyers and people that are in positions that don't have time to be able to manage all these assets.
Speaker 4:They'll turn it over to someone whom they know can create an extra margin of income that helps offset that co hosting, management fee that's coming off the top of that. But in the process of doing so, I do warn people there are some things you have to be careful of. So one, really, I I just say two ways that you end up potentially getting sued. One is let's say something bad happens at the property, right? Similar to property management, but let's say something bad happens at the property and someone's hurt.
Speaker 4:And well, look, having been a former personal injury attorney, I can tell you personal injury lawyers can assume everybody. Right? They're gonna sue anybody that has their ends associated with it. They're gonna sue the ownership because they had a duty to maintain the property or whatever the cause of the of the damage was. But then what does a cohost do?
Speaker 4:A cohost actually plays, a property management type role in terms of making sure everything is set up the way it should be and theory. If they're the ones checking everything daily, there's a possibility of accountability as to whether or not the the premises was maintained properly. So I remind people a couple of things you need to do. Number one, you need a cohost agreement. And it's it seems like it makes sense and it's common sense, but a lot of people are out there just doing this, throwing together something off the Internet they haven't looked at.
Speaker 4:A couple of things you need is some state specific provisions. You need to make sure if you're going to use a cohost agreement, you need to use where you're set up. You need to make sure that that state's laws and those provisions under contract law apply under your contract. And here's the other thing, the biggest mistake I see people do, because I don't blame them, I love marketing, but they'll mix their marketing language with their legal language. And what ends up happening is you take this stuff that because you're trying to close the owner.
Speaker 4:Right? You're like, oh, yeah. I want to do this. I want to really help you out and make you make more money. And so you got all this stuff you're promising from a marketing perspective diluting your contract language.
Speaker 4:That's one of the worst things you could do because you get into court, it looks like this promises you're making tied in with contract language separate those two. You need to keep the marketing piece as a different addendum to the actual contract provisions that you have. And, you know, really, I think, of course, I know I sound like a lawyer when I say this, but you should have a lawyer draft a lot of this specifically from negotiation standpoint that puts you in the best position possible in the event the owner tried to turn around and sue you. Right? So, you know, that because that's what'll happen the second way.
Speaker 4:You can get sued by the guest. You could also get brought in by the owner. The owner if the owner gets sued, they're gonna turn around and bring a lawsuit against you saying, no. No. No.
Speaker 4:I trusted you on all this. You were the one who was supposed to take care of these issues. And that's where that closed agreement is very important. I'll tell you the next piece is you need to set up at least a separate LLC. You want to separate your business activities of that business from your personal activities and your ownership.
Speaker 4:Let's say you own other assets down here. You need to have a separate segregated, I call a single purpose entity LLC, that serves that business's needs and do not mix funds that you're doing from somewhere else within that LLC.
Speaker 2:That is a great I'm actually glad that you brought that up because that's one of the hot buttons there that I like to poke with Chris a little bit. You know, when people talk about the excitement of forming an LLC, it's from a tax perspective, doesn't always make sense. But from basically an asset protection, that that's what they're
Speaker 3:intended for. Yeah. We talk about the single member LLC quite often and that that the value of it is from an asset protection standpoint. I have a question on that. Mhmm.
Speaker 3:But one thing I, you know, I wanna point out to the listeners, we talk about in teaching tax flow working with people that eat their own cooking. And what I mean by that is is Jeff is a short term rental and and a real estate investor, and and they take a practical approach to this. And and, you know, and I agree that that having the proper legal representation is very important, obviously. As far as the LLC, one of the some of the things that we that we run into is, just and, again, from the tax perspective, it's not as big of a deal. But working with people that, that might have a mortgage on the property, that I'm sure you've answered this a million times, and it may or may not have heard your answer on some other, media outlets.
Speaker 3:But can you give our listeners that might be tuning in for the first time to the SDR Law Guys that that play. So let's say someone comes to us. They're concerned about asset protection. They bought the property in their own personal name a couple years ago. Interest rates are higher, so they're concerned about potentially refinancing it.
Speaker 3:Can you give us a what what would be a good practical first
Speaker 4:or second step for someone like that? Okay. So get ready for this answer. Alright. So first thing first things first is one of the biggest things, most people, it's amazing to me, I think it's like 67% short term rental owners have their properties in their personal name.
Speaker 4:And as a result of that, you're talking about an overwhelming number of people who do. So there's two big issues that you have to watch out for. One is, I don't think, as big of an issue unless you're dealing with a certain type of mortgage company and they'll all name their name, but some of them are really notorious for this. One is the due on sale clause related in your mortgage, which basically says, I have a contract with the mortgage company because it's in my name, not the LLC. It's a different business.
Speaker 4:Right? So legally, they could call the note due it based on that due on sale clause if you just quitclaim deed that property into an LLC. But there's ways around this but and it doesn't usually get called. It costs the mortgage company more money than it's worth to call the note. But the next one is a pretty big one.
Speaker 4:The next one is what we call real estate transfer taxes. You have to be really careful because there are some states that don't have it at all, like Texas. You don't have transfer taxes in Texas? No big deal. There are other states, especially the Southeast, you know.
Speaker 4:I think about Tennessee. Tennessee has what's called the fonts tax, which is a real kick. I mean, it's and you have to actually apply for an exemption or exception every year. You have the you have the dog stamps fee in Florida. In all of these states, particularly in the Southeast, if you try to move an asset from your personal name into an LLC, they take a fine out of you with a transfer tax.
Speaker 4:And I've seen it as low as like point 2%, but as high as 2%. Imagine if you have a $3,000,000 short term rental of the beach and you just quitclaim it over and you get a 2 percent kick in the face when you didn't expect this coming. Well, there are ways around this and this is why it's so very important. Short trip calls are exciting. You get into it, but it's important to get good counsel before you pull the trigger on a lot of these things because you end up having these reader car shuts.
Speaker 4:I've seen people I saw somebody make these decisions on their own and they had so much in taxes that they ended up having to cover on this that they ended up really that affected their next investment. They really weren't comfortable to make another investment because of those expenses. There is a workaround. There is something known as a land trust. And one of the things that can happen is I'll have people that'll come to me.
Speaker 4:I had a lady come to me just this week, in fact. She has 10 properties, that she has some in Florida. She's got some in Georgia. One in Alabama. You name these different places that she's at from Gulf Shores to PCB, you know, 38.
Speaker 4:You can just all these wonderful places people want to go visit. The problem is she realized she starts calculating her real estate transfer tax. We now decided to use what is known as a land trust, which is nothing more than a simple grantor trust that you move land into, right? But when you move it in there, effectively what happens is you're kind of taking your fingerprint off of that transaction. There's two huge benefits to this.
Speaker 4:If you're using land trust the right way, it also helps you with refinancing. Okay? Because let me tell you the first piece. Number one is helps you with avoiding real estate transfer taxes because once you move that property into the land trust, you can then assign your beneficial interest in the property into an LLC. Now by doing that, you actually avoid.
Speaker 4:You're never in public record. And the way it works is, is that the attorney, what we do, is we list ourselves as the trustee as soon as we file it. But then as soon as we file it, we take our name off. We resign. The client takes over as the trustee, but on public record, it's not visible at all.
Speaker 4:Okay? So you don't even see it. Mhmm. We'll avoid the transfer taxes. And here's the beautiful thing.
Speaker 4:If you move the property from the land trust into the LLC, what if you wanna refinance? Like, some people right now are buying at 7%. You know, seven seven half percent. It's not always gonna be that way. We hope those loans are those rates are gonna crack down.
Speaker 4:At some point, they're gonna wanna refinance. But when you pull the property out of an LLC, lose your asset protection and it can also create a taxable event if you have to pull it out to refi. Why? Because you just identified this, Chris. Most of the times people are doing it in their personal name.
Speaker 4:When you think about a loan in your personal name that you put into an LLC, what do you think that lender is going to study when you say, Hey, can I refinance this when it's now on my LLC and I didn't tell you about it and I moved it over to Quicklanes? They're going to tell you, no way, man. You've got to pull it out of the LLC to be fine. But if you use the land trust technique, here's the beautiful thing. You can pull it out and do what's called restating the trust from a land trust to a living trust, a basic revocable trust.
Speaker 4:Right. Refi the property, refi the property, and move it back into the LLC, restate it as a land trust. You can do the full refi with no penalty. You keep your asset protection, and you can move it back into the LLC.
Speaker 3:And that's what people have to understand that this when you're I'll give you an example that people are familiar with. Ten thirty one exchanges. There's lots of rules and it it can be overwhelming, but it's not overwhelming. We did we did one personally last summer if you have the right people in place with the right qualified intermediary and the right we talk about, John, all the time, having building your board of directors and having the right legal team in place. And this is a specialized piece of, part of the law that you have to be aware of, and and that's why we're happy you're on also because you you guys work all over The United States.
Speaker 3:Yes, sir. So a lot of our a lot of people in and in our community, I'd say the majority of virtual rental investors invest in a state they do not reside in. Yeah.
Speaker 4:Very much so. Because why? Think about it. Most of these folks will go visit a place they love for vacation, And they'll say, boy, I'd love to own a place over here. You know?
Speaker 4:And then they realize the opportunity is with short term rental. So what they end up doing is buying a place there and then they visit on occasion. Right? They don't they don't wanna breach that what is it? Fourteen days?
Speaker 3:Yeah. You ever wanna go more than fourteen days, of course. But right.
Speaker 4:But they'll go and stay on vacation with their family, but then in the meantime, they can make all this additional money. And that's why you see a lot of these vacation areas exploding with short term rentals that are on some people don't understand.
Speaker 3:Absolutely. And it's a again, it's a it's a it's a great asset class. It's, you know, it's it's growing, and it it I feel like it just with with the pandemic, it was almost like it caught wildfire.
Speaker 4:Yeah. It
Speaker 3:did. And, really, from a family perspective, I know the short term rentals that we own, we're getting a lot especially as someone with a family, as the kids get bigger, it gets real tight in the hotel room. And and I just feel like with the hotel rooms now, a lot of the services they used to provide, they're just they're they're just not there anymore, but that's that's another story.
Speaker 4:Yeah. Plus, if you check hotel rates, like, I can tell you right now, hotel rates keep going up and relative to what you can get. But I will tell you, competition has tightened and I tell people, you know, as supply of short term rentals has gone up exponentially, demand has come down a little bit because of the economy. So the people who are still optimizing and learning and continuing to provide and listen to the market, they're still doing well.
Speaker 3:Exactly. And that's that's where we we think we you know, I know for us, I had a similar story with one of our properties that we we sold because and we didn't intend on it. But the thing is a lot of people that may have jumped in are 2020, '20 '20 '1 have to realize that it still could be a profitable endeavor, but it might not be as profitable as that first one. Though, again, there's some synergy. You gotta understand too if you're self managing, there's some synergy between going scaling from two properties to three properties and going up.
Speaker 2:So And you gotta protect your behind for lack of better terms. And, Jeff, you you mentioned something too that was was interesting. I mean, it's I wouldn't call it common sense, but I think it's more well, we'll say less common sense than it should be. But just the fact that you're saying if if you own properties across various states, that legal language or legalese, as some people say, will likely vary between those. And that's you know?
Speaker 2:And then you also mentioned too, taking out the marketing language, being a marketing guy, I I'm thinking about it. I'm like, oh crap. I've probably done that more times than I'd like to admit. But on paper, in a courtroom, you basically set yourself in a corner, I imagine.
Speaker 4:Well, I think about this too. You're exactly right. Think about it from a short term rental agreement standpoint. There are a lot of people I get people asking me this all the time. I don't really need a rental agreement if I'm doing all my rentals on Airbnb and VRBO.
Speaker 4:Right? And I said, well, be careful. Once again, you're trusting a platform. And I'm gonna give you a quick tip for those that are out there in the actual short term rental space that are renting right now. One way around Airbnb and BRU policies of not being able to gather email addresses for people.
Speaker 4:They do have an exception that if you do provide rental contract, you are permitted to request their email address. And here's what's great, a marketing guy. You can then take that email. We keep track of the great guests. We do email remarketing to those guests to a direct booking website so that we can book them directly through a direct booking platform at a discount.
Speaker 4:I'd give somebody a discount that I know is gonna treat my property right and all day long. But now I do I love the pro platforms, but I do not trust them. If you need to evict someone, what do you think that police officer's gonna look for? What's your lease agreement? Right?
Speaker 4:They don't care about what's on Airbnb. They don't care what's on those platforms. So it's really important. You talked about, state specific provisions. You need liability waivers.
Speaker 4:But in some states, liability waivers are not enforceable, but some are. So it's really important that those type of provisions are researched and included. So that way, if you're renting in a particular state, you know that you can enforce. Excellent.
Speaker 2:Well, excuse me. I feel like we can talk on this for probably a full day because now I'm thinking, man, I've been doing a lot of things wrong back in the day. But it's so Hey, John.
Speaker 3:At least you sold yours. So that's water under the bridge.
Speaker 2:Yep. I sold it a good time and a good place, and it all it all worked out really well. Jeff, before we before we get into the the weeds on something else and then but next thing you know, we're it's September and we're still talking. What's what's the best way if somebody has these questions? You know, could they reach out to you guys directly?
Speaker 2:Do you prefer both your website, LinkedIn? How what's the best way people can get ahold of you?
Speaker 4:Yeah. I appreciate that. So the website is strlawguys.com. Anyone can always email me personally at jeffstrlawguys dot com. And here's the thing.
Speaker 4:We started a YouTube channel where I go over a lot of this in-depth. If you do a search for STR Log Eyes on YouTube, we we've dedicated a lot of time of trying to make sure I've put out the educational piece on this, from everything from umbrella insurance to underlying insurance coverage to all of these points for asset protection in short term limits.
Speaker 3:Excellent. Well, I need to I need to, wrap up with my with my, special guest rapid fire questions. So these are just random questions that we're gonna ask you. And, but before I do that, again, STR Law, guys, and go in. If you're listening, remember, the defeating taxes private Facebook group, that's defeatingtaxes.com.
Speaker 3:Please jump in there. Post your questions. We will make sure they get to Jeff and his team, or direct or ask him directly or subscribe to his YouTube channel because we, you know, it's it's I'm sure a lot of the questions that you answer are very common in probably 80% of the, 80% of the question and and you said the answers are common for people, but then you have to apply that to your personal situation where you reside, what states you what state you own in. Do you have a a mortgage? Do you already own the property in an entity?
Speaker 3:And the it is would it be better for someone let's say they get a property under contract. Is that probably the best time to reach out to you?
Speaker 4:Yeah. So here's what I tell people is, first of all, if you have a plan in action and you know where you're headed, it's good to research this stuff. That's when you start looking at the YouTube channel and reading up on this stuff. But when you're putting in an offer, if you find a place, put in an put in an offer in your name and the signs and get to work talking to a lawyer so that if you're able to assign that contract into an LLC, are you doing a commercial loan? Are you doing a residential loan?
Speaker 4:What are you doing? Understand what the consequences are of each one of these based upon not just the tax implications later on, but also the asset protection piece and avoiding these type of consequences like real estate transfer taxes.
Speaker 3:Absolutely. That would be wise. That said, if you already own a property and you're you're concerned about asset protection, do not be afraid to reach out. The questions, here we go. Alright.
Speaker 3:First question, what is your favorite color? Blue. Okay. I'm a Michigan State Spartan, by the way. So I don't know.
Speaker 3:I'm but that's alright. That that's alright. Blue is a good color.
Speaker 4:I You said rapid fire, so I'm I'm throwing it out there.
Speaker 3:I know. No. But I've gotta shut up. My apologies. Your favorite sports team?
Speaker 4:I'm gonna say the Dallas Mavericks. I'm a big basketball fan, even though they're not playing well. Gogganer,
Speaker 3:Tostevin, so I'm gonna stop there. Favorite cereal?
Speaker 4:I gotta go Honey Nut Cheerios. I'm old school.
Speaker 3:Very good. Anyway, in my top five, what is your ideal weekend? Oh my gosh.
Speaker 4:Well, so I have to give the appropriate answer here that, the ideal weekend was the one we just had with my wife. We went to the Mirabel spa and, and, and so when we were there, it was just her and I, we have four kids by the way. So we range from six to 16. So for us, we got away for the whole weekend. We ate wonderfully massages her and I, the whole.
Speaker 3:That is a, wonderful weekend. And, we'll just put that on repeat. Kids.
Speaker 2:When we end this, we'll just put that on repeat, like, five or six times, and then we'll apply it for ourselves.
Speaker 3:Yeah. Just How about the okay. Then we'll I'll I'll give you a second question then. Ideal family weekend, assuming you are you have the kids.
Speaker 4:Ideal family weekend, I will say, my kids I I know it's pretty common here to say this. My kids love Disney World, so, we we love to do their VIP tour where you go, you do all behind the scenes stuff. You can see everything you wanna see in one day. Literally, they take you behind the scenes in a Cadillac Escalade, take you right to everywhere you wanna go, no lines. We love to do that in one day and then go to the beach the next day.
Speaker 4:That sounds amazing.
Speaker 2:See, I can I can do that? You know, everybody's got me scared of this Disney thing. I have a two year old at home who I
Speaker 4:I'm out on the lines. Ask. I'm out on the lines. I'm out on
Speaker 2:the And oh. Well,
Speaker 3:yeah. And, yeah, the lines are the lines are very much overrated. Yes. And then we'll get the fast pass. Well, we'll have to, definitely be in touch in the future.
Speaker 3:We we're excited for you to become part of the teaching tax bill community and spreading your wealth and knowledge, with our with our group, and I truly appreciate your time today. Thank you so much.
Speaker 4:Well, I appreciate you guys. Thanks for bringing me on. It was a blast.
Speaker 2:Absolutely, Jeff. And and thank you again from from me and the team members too that haven't been on here with us. And everybody who's listening, do not wait any longer than you have to to get your questions together on this. I know we're gonna get a ton of them, kind of echoing what Chris said too. Shoot them over to us.
Speaker 2:Shoot them over. Shoot them over to Jeff and his team. The only way you could really do this wrong and the only wrong question you can ask is the one that you don't ask, as cliche as that sounds. My father would be proud that he just said that. You know, that's good stuff.
Speaker 2:But, definitely, I mean, what you guys what you guys tell and and what we do too at the same thing is just planning. Planning, planning, planning, plan ahead, plan with purpose, and knock it out of the park. So Absolutely. Thank you again, Jeff. Thank you, Chris, for not harassing this gentleman too bad today, and we will see everybody next week.
Speaker 2:Hey, everyone. John Topolsky here still from the teaching tax flow team. Again, can't get rid of me that easy. Huge thanks to Jeff for joining us on this episode specifically. We couldn't think of a better person to talk about STRs than the STR law guys, or I should say guy in this specific case.
Speaker 2:The marketing heart in me just sings when I when I hear a a company or I should say a firm name in this case so direct and so niche as STR t r. Well, guys. So Jeff, thank you for joining us. Chris, as always, thank you for joining us and behaving yourself on this one. But, hopefully, anybody that listened to this episode got some great information from Jeff.
Speaker 2:Again, it's a very, very, very specific topic. Right? So if you've ever considered purchasing a short term rental, maybe there's a few things here that I shouldn't say should turn you away from it, but maybe just, you know, perk your ears a little bit and consider that even based on location, type of property, where you're marketing this, how you're managing that property, some of the liabilities that you may open yourself up to in certain cases as well. So, again, hopefully, you got some great info. Any specific questions, shoot them on over to us.
Speaker 2:We're happy to make the connection as needed to anybody that may be the best resource to answer that for you if it's not somebody specifically on our team. The defeating taxes private Facebook group is probably the best place to send that to, as always mentioned, or shoot it over to hello@teachingtaxflow.com. We always monitor that as well. So any of those questions you have, please shoot them over. We're not gonna bite.
Speaker 2:We may not have the best answer for you regarding your question, but we're absolutely going to get correct one for you, or I should say the best one that we can find by way of best resources, our ecosystem. But we look forward to talking to everybody again soon. We figured this was a topic so many people would enjoy cause we always hear it discussed at conferences, on podcasts, calls, emails, meetings, etcetera. We figured everybody would enjoy this that is related to it. So we thank you again everybody, and we will see you soon.
