Maya Weinreb 0:00
And then real estate investors are funny, they’ll have one LLC that owns two properties and then one LLC that has these business or these partners and this LLC that have these business partners. So you really need to be able to track all of those things separately, and you need to be able to run a p&l by property, you need to be able to run a p&l by LLC you know, I needed to know all these things and you need to be able to look at it whenever you need it whenever you’re looking at okay, do we have enough profit to buy another property or you’re trying to get another you know, an investor or maybe another mortgage or whatever it is you’re trying to do? You have to have those papers at the tips of your fingers.
Welcome to CRE PN Radio for influential commercial real estate professionals who work with investors, buyers and sellers of commercial real estate coast to coast whether you’re an investor, broker, lender, property manager, attorney or accountant we are here to learn from the experts.
J Darrin Gross 1:03
Welcome to commercial real estate pro networks, CRE PN Radio. Thanks for joining us. My name is J. Darrin Gross. This is the podcast focused on commercial real estate investment and risk management strategies. Weekly we have conversations with commercial real estate investors and professionals who provide their experience and insight to help you grow your real estate portfolio.
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Today, my guest is Maya Weinreb Maya is an entrepreneur and a real estate investment bookkeeping specialist. Maya’s been doing bookkeeping for almost 20 years, and is a QuickBooks Pro advisor. Before she started her bookkeeping firm, she held the position of CFO for a marketing company in Los Angeles. And in just a minute, we’re going to speak with Maya about what does every real estate investor need for their books.
But first, a quick reminder, if you like our show, CRE PN Radio, there are a couple things you can do to help us out. You can like, share and subscribe. And as always, we encourage you to leave a comment, we’d love to hear from our listeners. Also, if you want to see how attractive Our guests are, be sure to check out our YouTube channel. You can find us on YouTube at commercial real estate pro network. And while you’re there, please subscribe. With that, I want to welcome my guest, Maya Weinreb. Welcome to CRE PN Radio.
Maya Weinreb 3:04
Hi, thank you so much for having me.
J Darrin Gross 3:07
Well, I’m so glad you’ve joined us. And I’m looking forward to our talk. Before we get started, if you could take just a minute and share with listeners a little bit more about your background.
Maya Weinreb 3:19
Yeah, so I mean, you you kind of said it. You know, I’ve been doing bookkeeping, almost 20 years I had in house, bookkeeping positions straight out of high school. And I was CFO for a marketing company. And then I decided to start my own company I had I started freelancing. So I had bookkeeping clients that I was doing, you know, on the side, and in 2018, I decided to go off on my own. Which speaking of risks, that was a fun risk. But I did that. And you know, it’s a really interesting thing, being on one hand, a bookkeeper and accounting professional, where you’re looking at numbers every day, and you’re doing things very, very risk averse. And being an entrepreneur where sometimes you just you know, I mean, that is what an entrepreneur is right? Being willing to take risks, and being willing to not have failures, but learn from where you didn’t succeed, right? Everything is either a win or a lesson. So yeah, so I have a fun mix of both of those personality types. I have the entrepreneur kind of pirate and been willing to take risks and I have the bookkeeper, I have lists of everything and I know my numbers every single day and I think that from that I have a unique perspective to be able to help other business owners.
J Darrin Gross 4:48
Well, that’s great. The bookkeeping is also important. I know this in spades myself, and but it’s also But as exciting as insurance? Yeah, it’s but the importance. I mean, it’s what I find it is the kind of the score sheet that tells your story. You know, how the how your property is performing? Whether it be preparing for your taxes or working with lenders or or if even if you’re trying to tell a story to other investors. So, when when, when taking all that into consideration? I mean, just what, you know what bookkeeping is? How do you work with real estate investors?
Maya Weinreb 5:39
Yeah, I mean, like you said, bookkeeping is the building blocks kind of as for anything, next on finances, your insurance broker is going to ask for your p&l, a lender is going to ask for your p&l and investor is going to ask for a p&l, a tax planner is going to ask for a p&l. And if you don’t have that, you aren’t going to be able to do any of those things. So I think how I work with real estate investors is I just helped them get organized. So they have all of their ducks in a row, you know, we have many real estate investors that we work with. So we’re really used to it. And the best, most efficient way to keep the books, you know, we use QuickBooks Online. So we’ll create. And then real estate investors are funny, they’ll have one LLC that owns two properties. And then one LLC that has these business are these partners and this LLC that have these business partners. So you really need to be able to track all of those things separately, and you need to be able to run a p&l by property, you need to be able to run a p&l by LLC, you know, I need to be able to know all these things, and you need to be able to look at it whenever you need it, whenever you’re looking at, Okay, do we have enough profit to buy another property or you’re trying to get another you know, an investor or maybe another mortgage or whatever it is you’re trying to do, you have to have those papers at the tip of your fingers. And a lot of bookkeeping and accounting. Professionals and industries aren’t kind of keeping up with computer age and modern. And it might take you two or three weeks to get hear back from your bookkeeper or from your accountant and especially in tax season, but but all year long, because they’re not really set up both of them to be communicators, they’re set up to be you know, doing your books, and they don’t have time to talk to you and do your books. So I had to get really creative about that and and figure out how to have the business owners back how to be there for them. And to get the work done. And I actually had to go out, we got big enough, I had to go out and hire a customer service person just to be able to handle the communication and to keep up with the level that I promised my clients, which is we reply to all communication in one business day. So if you asked us for something we can get, you know, depending on what it is, but we’ll at least let you know when we can get it done. And if we’re doing monthly bookkeeping for you, or weekly bookkeeping, and you are asked for a p&l, and we obviously already did the bookkeeping, we can just send it to you in five minutes. You know, as soon as we see the email, if we’re doing quarterly bookkeeping, and you’re asking for a month that isn’t finished, you might have to give us a few days to get it caught up. But in general, you’re gonna have your information just right at the tip of your fingers. And I think that is very important for real estate investors.
J Darrin Gross 8:43
Yeah, absolutely having the information that’s readily available, as opposed to let me get back to you. Kind of a situation. So let me ask you this. This is one thing that I know, it’s been a frustration of mine. And I’ve talked with other investors. And I think that there’s some sort of, I don’t know, it’s a disconnect, or it’s just a kind of a translation of sorts. How do you work with the information of property manager provides? Because I don’t know that it’s always the same or consistent, I think I have I’ve run into different property managers that have their own little way of, of keeping score or, you know, we all know that rent is rent. You know, laundry, might be laundry or utility income might be you know, whatever those fees are, whatever they’re, they’re they’re keeping track of, but beyond that, the expenses and who’s paying what and categorizing all that stuff? Yeah, it’s almost like they create their own language. How do you how do you reconcile or work through that to help your your real estate investors?
Maya Weinreb 9:50
Well, I think probably because I’ve worked with so many different industries. I’m used to everybody having their own language and their own way that they Do it. And I think you’re right of our real estate investors that have property managers, we get the data all different ways, you know, some of the property managers will send a, they’ll send the net proceeds. And they’ll have paid a bunch of maintenance and, you know, different things out of it. And so they’ll just send us these, you know, Excel spreadsheets, or even sometimes handwritten on the back of checks or whatever, where it says what the money was, that came out. And in that case, we enter it in that way we enter in, I mean, in bookkeeping, you have to work backwards. So we would enter an end deposit for the gross amount and expense all of the expenses to the correct, you know, property and category. So where the net Check matches the net Check received, then there’s other property managers who do it the other way, they have an expense account, that is the real estate investors account. And so they deposit the entire rent amount, and then they have, you know, whatever, a debit card or a checkbook, and they pay things out that way. And then we have to track it like that. So it really just depends. It also depends, is this a multi unit property where you have, you know, 200, rent checks coming in? Or is this a, a house that’s being rented out? Or, you know, so it really depends on how the real estate investor set it up with their property manager and what information is needed? Because for instance, there’s not that they’re a real estate investor. But you know, adjacent, we have an HOA that we do bookkeeping, for, for an enormous property. And they have all of their bookkeeping in another software, not their bookkeeping, but their rental information in our portfolio, which other real estate investors use as well. And basically, the way they want it is they want QuickBooks to 100% match at folio, is that something I would recommend? No, because I think it’s redundant and unnecessary. And if you’re going to have a whole software that has all of your information, I would do QuickBooks just for tax purposes. So you just have income, you know, and expenses and not have duplicate work. But that’s what they needed, because they wanted the redundancy. There’s other real estate investors where they have a similar thing, and they’re using another app, I think the other one is building them. And they’re using building them, they’re using out folio and and that’s totally fine. But you don’t want to do in my opinion, you don’t want to do redounded double work. So give us the gross amounts, and the net amounts, you know what I mean? Like we’ll give us access to that software so we can figure out what stuff is. But you don’t need us to enter each check individually for 200 renters each month, you know, stuff like that. So we really work with whatever system the person is using, and then just recommend best practices to save them the most amount of money and efficiency and get them what they need.
J Darrin Gross 13:18
Sure, no, I just wanna make sure I understand the the, the 200 unit property, you’ve got a client that wants you to input every check for every tenant? Yes, well, I would think I can see the benefit of having, you know, the the gross amount of rent the the, you know, and then itemize the expenses below that so that you have a net deposit that matches what what you receive. And I think because I think you know, tracking all those expenses. You know, that, I think one of the things and again, I I’ve been guilty of the DIY kind of bookkeeping for a while until I realized that there was a smarter way to do it. Is it the Schedule E? Is that kind of the the the expenses that get tracked primarily by for tax purposes? Is that kind of the those categories? Is that kind of the ones that that you look for or that that the that you would pick up from the the property management software or bookkeeping records? Well,
Maya Weinreb 14:31
I forget which schedule it is honestly, on top of my head because I don’t do the actual taxes. But businesses in general all have follow the same laws as far as what is tax deductible, the you know, as far as the assets and the mortgages and the loans and things like that, that’s you know, what you’re tracking on your balance sheet, and your CPA is going to put those in in the most tax beneficial way for you hopefully, but as far as the expenses, it’s pretty much I mean, even just business to business, it’s going to be the same, right? Anything that’s a business expense. So the the utilities, the even the, you know, the business meal, the investor meetings, the promotion, the marketing, the vehicle expenses, all any home office expenses, that the real estate investor has all of those as well as the specific expenses for the property. So, you know, we’re always looking at how do we save you the most money on on taxes, and the best way to do that is to, honestly to have bookkeeping, so you’re not missing deductions that you should have, because you’re gonna forget, when people go out to eat with their business partners, and they don’t use their business card or whatever, they’re just going to forget that they spent that money. And that’s a business deduction. So if you, you know, we try to set people up for best practices. So that way, they are able to save the most amount of money on taxes. But at the same time, business owners and entrepreneurs and real estate investors are going to do what they’re going to do. And if they don’t use the best practices that we recommend, we’re still going to do the bookkeeping for them, it’s just going to take longer, so then they’re just gonna end up paying more money in for bookkeeping, and potentially more money for taxes. But we’re still going to help them and we’re still going to do you know the best that we can. So like I said, with this HOA that wants us to make everything redundant. That’s not what I would recommend. I think that cost them a lot of money to do all that double work. But that’s what the HOA needs. And so that’s what we’re doing for them. Whereas there’s other things where I tell my bookkeepers as I have a team of six bookkeepers that the client is not the expert in bookkeeping we are. So just because the client says, do this or do it this way. Or even when they say my CPA, that’s probably not what their CPA said they probably misunderstood it. And just because they want us to put the owner’s draw on the p&l doesn’t mean that we can or we’re going to, you know, we can work out what is what are they trying to solve? You know, what is the problem you’re trying to solve? Oh, well, I just want to know what I really have left at the end of the year. Okay, great. Let me show you how to get that. Or let me create a report for you that has that. Or let me show you how your statement of cash flow works, right. But they are not just going to do what they think because we’re the expert. And just like they might be the expert on real estate investing. And I’m not an expert on real estate investing. But I am an expert on real estate, investing bookkeeping. And so I will tell them the best practices, but I’m also going to work with them, I’m not going to say, Well, you didn’t follow my advice. And so I’m not going to do it for you, I’m just going to say, Well, you didn’t buy it, right. So this is actually going to take 10 hours longer than it would have if you did but I’m gonna do it for you just as long as you’re willing to pay for that.
J Darrin Gross 18:12
Yeah, no, I hear you the you know, everybody thinks a little bit differently kind of thing. But at the end of the day, if you’re trying to report to whether it be a bank or the, the IRS or, or, you know, there is a standard of information. That’s that’s expected. And I think that’s kind of the, you know, at the end of the day, what your numbers have to reflect and in some way, shape or form.
Maya Weinreb 18:39
And they will, they will at the end of the day, but it just like if you look at a p&l, it’s going to show you the top line information. So how much detail you want in that for instance, the p&l for the this Hoa is going to look the same whether I entered in rent check by rent check, or whether I entered in a gross you know, rent. So it’s just when you drill down how much information do you need in there and and I personally think that when you have industry specific software that’s tracking, you know, even for construction companies where they have their ARs and another they have their estimates and invoices and all that and another software, I don’t think it makes sense to duplicate that work and do it again in QuickBooks. That’s not necessary QuickBooks can do it if you’re only using QuickBooks for that. But otherwise, you know, use QuickBooks in the most efficient way that you can to get the information that you need for your taxes. Unless you’re managing your company out of QuickBooks. I manage my company out of QuickBooks as far as you know, I have all of my clients in there and all the invoices and all that but I’m not also using another software to do that. I have it all in one place. And for for property managing QuickBooks is not the best software for you know for. out again for like construction companies, I wouldn’t say that QuickBooks is the best software when there’s industry specific software that does all that. But that software doesn’t do everything that QuickBooks does. Because it’s not it doesn’t have the same purpose of QuickBooks, accounting and getting stuff ready for taxes. So you really have to just, you know, use music common sense. And B, keep it simple. If that’s my motto, keep it simple.
J Darrin Gross 20:30
Good, good rule for accounting. And that’s for sure. Yeah. So let me ask you this, what are the things that people miss the most.
Maya Weinreb 20:41
Um, I would say that, especially when you have your property managers send you net checks, people miss getting all the information. So they’ll give me just the net check amount. And this, this is across the boards on many industries, but specifically for real estate investing, they miss getting you all the information, and that makes your books wrong. If you don’t have the gross amount, then you’re then your income looks wrong. And that might not matter. For tax purposes, you know, if you if you’re gonna say, well, but the net amount is what is the net amount, and that’s true. But if somebody wants to see your p&l, your numbers are going to look deflated, if you don’t have your revenue in there correctly, and the expenses. And for instance, if you are looking for an investor, and you’re showing, here’s my numbers, and you don’t have any expensive and you just have a net income on the top line, and then you know, a telephone bill, and your and then your name come on the bottom, it’s not enough information for an investor to make a decision. They’re gonna say, Okay, well, this, how do you not have any expenses? Are you either not tracking expenses? Are you paying it out of net, and you’re not gonna really give the whole story. So you need to put in the gross rent tax or, you know, whatever money you’re getting in, and all of the expenses having to do with the property. So you’re telling the correct story to anybody looking at
J Darrin Gross 22:18
it? Yeah, no, that’s, that’s what I’ve been guilty of a long time ago, but definitely all of the numbers, they all have to be part of the story. Yeah. Because I
Maya Weinreb 22:31
have, I have personally, I have friends that are investors. And they will, they’ll tell me, you know, I looked at this person’s books. And it all looked good, you know, from first glance, but then I started wondering, why don’t you rent out a giant garage to store all of your equipment? And why isn’t that on your books anywhere, and then it came to light that? Well, it was because there it came out of over here, because the owner still owns it directly. And therefore, if I would have bought this, you know, or invested into this business, I would have had this other expense that I didn’t know about by looking at the p&l. So it’s, it just can cause you problems. It could make contracts, get cancelled for you know, incorrect information. I don’t know, whatever you call that bad faith, things like that. So you have to put all the information in there to set yourself up for success for so many different reasons. And, and it’s not even like I said, it’s across the board. It’s many industries, even things like when people get paid via stripe or square. And those third party platforms remove their fees before they deposit the money. People just put in the net amount. But that is not correct. That’s not your income, your income is the top line minus the expenses. So we have to go work backwards and put those in.
J Darrin Gross 23:57
Yeah. So what do you find that the things are the most people get confused?
Maya Weinreb 24:08
I think there’s a lot of tick tock advice these days. And it’s not that the tic toc advice is necessarily wrong, but that it only applies in specific situations. So you can’t take a piece of advice and automatically tell your CPA or bookkeeper that it applies to you. It might or it might not. Because so many of these things depend on Are you an LLC, are you elected to be taxed as an S Corp for Are you a C Corp where it was sole prop? What revenue level are you in? Do you qualify for that credit? Just because your friend did doesn’t mean you do. So if you know and I listen to this advice, too. I scroll through there and I Oh ha That’s a good point. And some of it is you You know, really good advice that people missed? A lot of it is really good advice. But the only thing is that it just doesn’t apply for every situation. So you have to work with a CPA, a tax planner, I mean, a bookkeeper. Yeah. So that your bookkeeper is gonna get your basics. If you come to your bookkeeper and say, Does this tax loophole apply? They may or may not know, because they’re not in the business of doing taxes or tax planning. They’re in the business of recording history of what happened in your company. So you have to have a CPA and preferably, or a tax preparer and preferably one that does tax planning. So you can sit down with them and say, Hey, Tiktok told me that if I rent my, if I use my property for business meetings for two weeks out of the year, I can take this deduction. And how do I do it? And what’s the best practice? And what’s the numbers? And then the taxpayer will tell you or your hopefully your tax planner, right, this is not all CPAs? Or taxpayers do tax planning will tell you Yeah, exactly. You should this is how to do this. Because you can’t just do it with no paperwork with no nothing like it, you can do it if it’s a legitimate tax loophole. But in order to not get audited in order to have this correctly, here’s how to implement that. Or, you know, I’ve heard on tick tock that I need to pay my kids payroll. Absolutely, that is a legitimate thing. But here’s rule that go with that your kids have to actually be doing something for your business, you can’t just pay them to pay them. Because you have to prove you’re paying them for something like I follow. You know, Grant Cardone them will 10x movement, I don’t know if you’ve heard of him, probably, he’s a big real estate guy. And he knows his kids, but he makes kids go on stage, and talk in front of 1000s of people. And that’s what they eat, where they get paid speaking fees. And that, you know, they get there in some of his promo, they have modeling fees, they get speaking fees, and legitimately they get paid. But if you have a two year old and you’re not at least using them for promotion and marketing, then you can’t legitimately pay them. So again, it’s not that I’m gonna say this advice is wrong. I haven’t heard all of it. Some of it might be wrong, but it’s use it correctly, get all of the rules and make sure that you are using it correctly and that it applies to you.
J Darrin Gross 27:33
Yeah, that’s definitely I love the inference that the Tiktok accountant is the Yeah, the superior. But that’s funny. So let me ask you this, what do you find that people do wrong? Um,
Maya Weinreb 27:52
well, I would say real estate investors are better than most industries, because they always have investors looking at their, you know, things on so they generally do have a set of books of some kind. But in general, I would say what people do wrong is not having bookkeeping, they try to wing it. I’ve talked to companies that have 700,000 revenue, and no bookkeeping. And she, you know, they’re stressing out. They don’t know. I don’t even know if I have enough money to hire another person. I’m like, Of course you don’t? How would you know? What do you what are you like gut gut feeling with. And as an entrepreneur, myself, and a bookkeeper? I just think, I just think that crazy, I don’t know how you could possibly live your life like that. That is, you know, that is more risk than I would be willing to take as an entrepreneur. So I think that having your numbers gives you such a sense of stability, and direction and peace of mind that trying to wing it all the time. Isn’t, you know, I mean, maybe some people just innately kind of know their numbers, and that’s great. But I think so I don’t know if this is what real estate investors do wrong because they generally have numbers because they had to, but not having the books Correct. Missing deductions, not having a professional to ask, just like real estate investors go to all these seminars and learn things about being real estate investors. They’re not doing that for bookkeeping, because why? Why should they? So you’ve got to get a professional to help you even if it’s just someone that can answer questions for you and get it right. Otherwise, it’s going to be a mess at some point and it’s going to be stressful and who wants to do that thing right before taxes are right before you need another investor where you’re spending three days hidden away with a pot of strong coffee and maybe something stronger and a box of receipts and your bank accounts. You’re smiling, like, you know what I’m talking about? Yeah, tax
J Darrin Gross 30:05
tax season, I know exactly what you’re talking about.
Maya Weinreb 30:08
Yeah. Let’s not do that. Let’s not?
J Darrin Gross 30:13
Well, in here’s, I think probably the question I want to ask you that, I think is probably the key to a lot of this, what’s the frequency that people are doing their books, as opposed to what you recommend?
Maya Weinreb 30:28
Um, that, I think it really depends on the amount of transactions and what’s occurring. You know, for instance, if you asked me how often a law firm or construction company or a marketing company should do their books, you know, I would have a different answer, a real estate investor that has a property manager, if they don’t have a property manager, then like, every day, you know, but if they have a property manager that handling the day to day for them, then depending on the amount of transactions and revenue, because you might be able to keep it up quarterly, you know, if you’re just kind of starting out, and you have a couple of properties, it’s not something that you have to look at every minute, necessarily. So maybe quarterly would be good enough, if you have several properties, you know, you would probably want to move to monthly. But again, it depends on if you’re doing it yourself, or if you have a team, you know what I mean? So there’s just a lot of variables, I would talk with the person and see what makes the most sense for them, their revenue, their amount of transactions, and whether or not they have a property manager, or they’re trying to be the property manager.
J Darrin Gross 31:46
I just said, I was gonna say, just kind of a confession, the more frequent you do it, the easier it is to catch anything that’s not right. And also fix it, or get it corrected. That’s what I found even like my property manager, like one time, they’ll record like a laundry income as like rent. The next time, they’ll, you know, and it’s still it’s all gross income, but still, like, you know, you’re talking, it’s nice to be able to isolate, and, you know, be able to tell the story to show exactly what this is and why it’s this and so that at the end of the year, when you have to report to the IRS, or if you’re trying to give the bank something, it all adds up. And you don’t have you know, the the 1099 you get from the property manager doesn’t match what you recorded. Because, you know, you didn’t you didn’t identify it as it happened, when it was something that could be, you know, updated, or they could they could correct that kind of thing. So, yeah, but
Maya Weinreb 32:53
this depends, like, what is it? Is it a rental property? Is it a property that you’re just holding, and you’re not renting? Like, there’s so many different things, that is still considered real estate investing? That it would just really depend. But yeah, I agree. I mean, I think, generally, I would say at least monthly, but again, if you don’t have a property manager, or if you need to be reviewing your property managers work, then even more often than that,
J Darrin Gross 33:26
yeah, well, and I think the other thing that I find with this is that, if you’re not in the habit of doing this, you need to get to a frequency to where it’s not. Now what do I do, you know, yeah, kind of thing. Because I’ve gotten, you know, stretches, where I thought I just did it and come to find out, it’s been three months, you know, since we sat down and input the stuff, and I do have a bookkeeper, but I work with her and that I will input the information, I’ll send it to her for, you know, to make sure that everything was recorded properly, or the way it’s, it’s supposed to, because I used to, you know, think I was doing a download from the bank and call it all good. And then at the end of the year, he would be like this, you know, I can describe at least three days of heavy, you know, dark coffee and you know, grinding my teeth and it’s like, Oh, my God, and then you’re trying to go back and find out what is this and what’s that and, and, you know, you’ve I’ve forgotten I couldn’t tell you what that is, even though I made notes on whatever they were you find the receipt or whatever, but it wasn’t so you end up missing the opportunity to tell the full story. Or you just decided okay, it doesn’t matter. I can’t you know, I can’t figure it out. So I’m not gonna worry about that. A little bit here a little bit there after a while it adds up. And
Maya Weinreb 34:53
and if you’re doing your own bookkeeping, which honestly I don’t recommend, but if you are, then Yeah, I mean, just take 10 minutes a day and do it.
J Darrin Gross 35:04
Well, let me ask you this because I think you know, there’s a point. And again, we have property management. So we get the reports from the property manager, then we we input it into QuickBooks, kind of the gross numbers like we’ve been talking. And then I have a bookkeeper I use on kind of just a periodic basis, say, hey, look, here it is, make sure it’s tight with the year end. I’m not like on Oh, my God, you know, whatever. How do you? Is there a frequency that you work with? Or is it do you? Or do? Do you have the capability of working with somebody similar to like what I do? Or is it all or nothing like we do everything or we can work with you?
Maya Weinreb 35:48
Here’s, here’s the thing, the honest answer is that it’s best done right the first time, and that’s the fastest way to do it. So what your bookkeeper may or may not be telling you is that the amount of time that it takes to fix things in software and in QuickBooks is at least three times longer than it takes to do it right the first time. So if you’re doing it yourself, and then they give you a kind of list of things to fix, and you know how to fix it, then that’s one thing. And if you’re trying to do that, for the purpose of saving money, if you’re at the point where you just hate bookkeeping, like, honestly, most people I talked to, or you just don’t have time for it anymore, then it makes more sense to just have the bookkeeper do the entire process, because it’ll be most efficient that way, where it’s not going to be a bunch of going back in and fixing. And that’s the thing that I run into, you know, like, they talk about that, that you see these posters and different trades, like, you know, hiring me to do this for you $100 An hour or doing it while you watch $200 an hour, doing it with me $1,000 an hour, whatever stuff like, it’s kind of true, because we’re going to get it done, right. And if we have to go in behind you and fix what you’re doing, it honestly takes longer. And we do have clients that do that. And they prefer to do that. And I just tell them, Okay, but we do charge more for that our hourly rate is higher for doing, you know, reviews, kind of consultation type stuff, but but we’ll do that, if that’s what they really prefer. They want to go in and do their own bookkeeping, and then they want us to go in behind them and review it and either tell them what to fix or fix it ourselves. I just don’t know that they ended up really saving any money that way. That’s
J Darrin Gross 37:46
Oh, sure. No, and I’m not suggesting I’ve figured out how to save money. It’s more a matter of, I think probably more than anything, it’s a habit of the way that I started doing certain things. And I worked in originally worked in quick in and then graduated to QuickBooks and still have some that aren’t quick. And so it’s kind of a mishmash of, of but you know, each property, each entity, kind of thing. And I will say this, I’m blown away by how, how much more you get with QuickBooks than quick and I you know, quick, quick ends, basically a checkbook register it’s not, does not have the tools at all, or it doesn’t it’s, uh, it doesn’t speak the, you know, the accounting language like QuickBooks does. So,
Maya Weinreb 38:33
right. Yeah, it doesn’t at all, and neither does some people try to use QuickBooks simple start, or sorry, I take that back QuickBooks self employed. And that doesn’t speak the accounting language either. That’s, that’s kind of like if you have an Etsy company on the side that makes a few $1,000 a year, then I’d be like, okay, yeah, I use self employed. But anything else, you need to use a real version of QuickBooks at least simple start, if not, you know, essentials, that has all the tools that you need,
J Darrin Gross 39:03
ya know, and get it set up, right? Yeah. Don’t don’t create the problem and then say, hey, Maya Help.
Maya Weinreb 39:12
Yeah, I will help. I always help. I don’t turn people down. But you know, depending on what the problem is, I will charge them more or less, to fix it for
J Darrin Gross 39:22
them. Right. Right. I know that the setup is key. i That’s the one thing I figured out that. Don’t attempt to do that on your own. You don’t know what you’re doing.
Maya Weinreb 39:32
Yeah. But also, just to answer your question earlier, you know, I do still my own bookkeeping for my company. I’m actually training someone right now to take that over from me because I thought that one day, maybe my bookkeepers who work for me could take it over and then I realized, no, they’re too busy doing bookkeeping for clients. So I’ve been doing it myself, but I like to know my numbers every day. So I just go in and do it every day and it takes me about five to 10 minutes And then it’s done, you know, and, you know, once Well, probably not once a month, but you know, I go in and reconcile and keep everything up to code for my CPA, who then files my taxes. And, you know, tells me things as well, like, oh, you need to blah, blah, blah, Sure, okay. And I can go in and fix it, and I can do anything that’s needed. But yeah, if you’re doing if you’re good at bookkeeping, and you like it, then just go in every day and spend 510 minutes on it, you know, and then you have your numbers to him. But if you can’t do that, or you don’t like it, or you don’t have time, or you don’t know how, then write everything down on the receipt, scan it into your QuickBooks out, your bookkeeper will be able to code it per property per LLC.
J Darrin Gross 40:48
Yeah. Well, again, I think what do you just kind of reiterate is that frequency thing you’re going to be if you’re going to be you are responsible for doing the bookkeeping in any way, shape, or form. Do it as soon as possible rather than so
Maya Weinreb 41:04
Yeah, exactly. But if you get in the habit of doing it, either every day while you’re having your, you know, morning coffee, or let’s say you take your kind of, you know, administrative tasks day and you go Sunday, I sit down and, and do QuickBooks and coffee, then that you knew how to put it in your schedule. But otherwise, yeah, you’ll forget. And it’ll be three or four months. And you’ll be like, Oh, shit, sorry, I’m not I don’t know, if I’m allowed to swear. I didn’t do my bookkeeping. And now I don’t remember what any of these things are. And I don’t remember I knew I was, I made a mental note to remember why I took that $350 out of the ATM. And now I have no idea what it was for because it was four months ago. And that’s where you lose tax deductions.
J Darrin Gross 41:49
Guilty, guilty guilty. Hey, Maya, if we could, I’d like to shift gears here for a second, by damn an insurance broker. And as such are worth my clients to assess risk and determine what to do with the risk. And there’s three strategies we typically consider, we first looked to see if there’s a way we can avoid the risk. And that’s not an option. And we look to see if there’s a way we can minimize the risk. And if we cannot avoid nor minimize the risk, we look to see if there’s a way we could transfer the risk. And that’s what a an insurance policy is a risk transfer vehicle. And etc, I like to ask my guests, if they can look at their own situation can be your clients, real estate investors, the tax code, whatever that you think of or would would like to identify that you consider to be the biggest risk? And again, for clarification, while I am an insurance broker, I am not necessarily looking for an insurance related answer. And so if you’re willing, I’d like to ask you, Maya Weinreb, What is the Biggest Risk?
Maya Weinreb 43:05
Yes, I thought about this, I thought about this. I think the biggest risk right now, for real estate investors, for clients, for entrepreneurs, for individuals, for everybody right now, is the fact that the IRS just hired 87,000 new auditors. And you know, we saw articles about that a lot at the end of last year. And I don’t know if they’re all hired, and they’re all implemented. But what does that mean to an individual? What does that mean to an investor? That means that they’re, they’re 87,000 times more likely to get audited, at least not saying I’m a mathematician, so maybe me No, that’s not the exact math, you math it. But to me, that’s 87,000 More people who could potentially go and audit your business, your investments. So it just makes it so that all of the things that you’re supposed to do that you kind of said, well, no one’s ever audited me and it’s never really been a big deal. Now is the time to get all of your ducks in a row. Because you are have to map it correctly. Let’s just say there’s 87,000 More people who could try to audit you than there were before those 87,000 more resources to do that, because the IRS doesn’t have time to deal with all of our stuff. Right? They’re they’re busy going after big fish. And we know ways. You know, there’s many tax strategies to minimize risk to not look like you have a bunch of red flags that might get audited, and that’s great. So we want to keep doing all those things. For instance, if you have an S corp To make sure you have payroll, that’s the biggest red flag, you know, a lot of real estate investors aren’t S corporations, their LLC, and so it’s different. But sometimes they have holding companies that are s corpse, things like that. And if the IRS audits, you, they’re gonna want to see your books, they’re gonna want to see receipts for everything, they’re gonna want to see bank statements. And on things like business meals, or whatever, that a lot of people not gonna say, a lot of people, some people every time they go to dinner, or have dinner by themselves will consider it a business expense. And the IRS is gonna want you to prove that it was a business expense, and who you went to dinner with. And that needs to be, you know, written on the receipt or in your books for it to make sense, your 1099 that you’re like, Well, I’m not going to turn 99, the plumber because it’s never really been that big of a deal. It might start being a big deal. There’s there are rules written into the IRS code of what happens if you don’t file a 1099 on someone, and you allow you know them to work for you under the table. And it’s not that big a deal. There’s rules and there’s big penalties, there’s penalties for filing a late 1099, there’s penalties on not filing a 1099. And they have not that I know of to this day actually implemented those penalties because they haven’t really had time to deal with all of the 1099 filing, for instance, as an example. But now they have 87,000 More people who might be taking a look at that. And in the IRS being the IRS, if they find something that you did wrong, they might try to go backwards and audit you the last seven years. So now is really the time to make sure that we have all our ducks in a row, that we’re using the same tax return to get our investments that we use to file with the IRS that we are filing our 1090 nines on every single person that’s a service provider, that we have detailed receipts on everything. And I think that while I hope that we can continue, you know, just being risk averse, and and not creating things that are red flags, I don’t know that that’s the case anymore, that might be changing. They might be you know, I’m really trying not to swear, they might be getting harder on us. And so in order to avoid risk to mitigate risk to minimize risk, you got to have all your legal bookkeeping, IRS ducks in a row. And I don’t mean to say that there’s some big monster that’s terrible and scary, because they’re not. And they’re all you know, pretty much all IRS agents and auditors are nice people and they’re helpful and they’re just doing their job. And it’s not to say don’t go make money or go hide in a corner, you know, make money, they can’t talk to you. If you’re not making money, go do something, you know, go go buy that property, go do that cool thing you’re doing. But just have all your ducks in a row so that nothing can ever come back and build, you know, tear down your empire that you built.
J Darrin Gross 48:22
87,000 new IRS auditorsm, definitely something to be concerned with. Maya, where can listeners go if they’d like to learn more connect with you?
Maya Weinreb 48:34
Yeah, my website is SolvencyNow.com. And they email me at firstname.lastname@example.org. That’s ma y A and solvency now is Sol VCY, n o w. So my solvency now.com. Or you can check out my websites, SolvencyNow.com. You can click on there for a free consultation. I also do webinars every week that you can go to my YouTube page. As far as I think you can get to through my website. You can find me on Facebook, either under my eyeliner or solvency now, bookkeeping, Instagram, LinkedIn, tick tock, I hear tick tock and right now I’m just kidding. I just tell people to file there’s headline memes and pretty much you can send a smoke signal and I will help you I really I personally have a purpose and helping business owners and entrepreneurs succeed. My mission statement for my company is complete and perfect financial records for your peace of mind. So I’m really I really want to make this area less stressful for people and I’m doing it as a you know, tech company and not as an old school kind of accounting will get to you when we get to you style. So we’re I’m really really here to help people and that’s what I live for. So yeah my solvency now dot com solvency now.com. Or I’m not on Twitter, but pretty much any social media either under my Weinreb or solvency. Now, bookkeeping, you can find me and send a message and I will reach out, reach back out to you and schedule your, your consultation.
J Darrin Gross 50:19
Great. Maya Weinreb thank you so much for taking the time to talk today. I’ve enjoyed it. Learned a lot, and I look forward to doing it again soon.
Maya Weinreb 50:30
Yeah, thank you so much for having me. I hope this was helpful to your listeners. And I do hope to do it again as well.
J Darrin Gross 50:39
Great for our listeners. If you liked this episode, don’t forget to like, share and subscribe. Remember, the more you know, the more you grow? That’s all we’ve got this week. Until next time, thanks for listening to commercial real estate pro networks, CRE PN Radio.
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