Behind every successful multifamily asset stands good counsel- both legal and tax. One statement that is absolutely true about tax counsel: if you don't call, they can't help.
Tax counsel is money well spent. Engaging a firm with full time tax professionals assures your circumstances receive the benefits from counsel that is aware of current tax law and best practices. Tax strategy is not about filling out forms; tax strategy takes into account the application of current tax code as it relates to your financial state of affairs.
Even with stabilized multifamily assets the pace of change in tax law can be overwhelming. A buy and hold strategy that has a ten or twenty year ownership objective can be severely tempered based on changes in tax law.
Too many people believe that your lawyer should stand at the ready (24/7) and your accountant should be called April 14. In fact, contacting your accountant on January 2 is too late as any recommended changes cannot be accomplished because the tax year is now over. Tax planning is a year-long process that, when done correctly, takes into account the changing nature of aggregate circumstances and that of individual assets affecting your tax consequences.
In the normal course of property management we are usually determining next year's budget in November of the prior year. Consider, please, making October "tax matters" review month. Maybe a new holiday for October 1 that we name "call my accountant" for coffee day. The point is to get ahead of tax matters prior to the end of year. You will be glad you did...
About This Blog
Multifamily Insight is dedicated to assisting current and future multifamily property owners, operators and investors in executing specific tasks that allow multifamily assets to operate at their highest level of efficiency. We discuss real world issues in multifamily property management and acquisitions. This blog is intended to be informational only and does not provide legal, financial or accounting advice. Seek professional counsel. www.MultifamilyInsight.com