Month: October 2022

To avoid risk, it is prudent to diversify your investment across a variety of asset classes. Real estate investments should form part of this portfolio diversification.

One of the easiest, low-risk ways to enjoy real estate returns without the stress and risk of owning property, is through a real estate investment trust, also known as a REIT.

Real Estate Investment Trusts

If you’re interested in receiving high rates of return, then REITS have a history of high dividend payouts. This is one of the reasons that they are in such high demand by retirees. If you don’t need the income, then you can grow your investment by reinvesting the dividends.

Mutual funds and ETFs invest in a variety of REITs in order to enjoy a diversified risk profile.

The Advantages of REITs

REITs offer a unique opportunity to diversify your financial portfolio. You benefit from the high returns of real estate without the danger and volatility of equities. In addition, real estate and equity returns have a positive correlation, helping to insulate your investment from market swings.

Your real estate investment also enjoys sector diversification. You’ll own interests in various properties across several market sectors as a REIT investor. You’ll be exposed to industrial warehouses, commercial properties as well as apartment complexes. You’ll find that funds include bigger properties like hotels or office buildings that many investors can’t access.

You also get to invest in property across a host of geographical locations. You’ll enjoy fractional ownership in properties across states, cities, and countries.

And if you are a foreign investor, restrictions on owning properties in other countries are avoided by acquiring shares in REITs.

You get to enjoy above-average dividend yields with at least 90% of taxable income paid to investors by law. This ensures excellent returns when reinvesting dividends as well as on capital appreciation.

The combination of high dividend yields and property’s long-term capital appreciation make REITs an excellent investment. While selling an individual property is time-consuming, REITs are highly liquid, allowing investors to move in and out of the funds quickly if funds are required.

One of the biggest benefits of REITs is their ability to offer access to commercial properties such as shopping malls, data centers, and apartment complexes. Unless you have the resources, class A office buildings are beyond the reach of average investors. REITs provide you with access to these lucrative investment opportunities.

Disadvantages of REITs

While REITs offer investors many advantages, there are some disadvantages to owning them.

Interest rate fluctuations can have a significant impact on yields. As interest rates increase, the price of REITs falls.

The tax on REIT dividends falls outside of the capital gains tax rate. What this means is, that you’ll be paying tax at your ordinary income tax rate.

There is the potential for high fees and increased risk. You are advised to research the property market thoroughly as well as take note of interest trends, the effect of tax law changes, as well as property values in the various property markets. High management fees can also affect your returns and a careful reading of the fund rules will go a long way in helping you identify potential pitfalls.

REITs are best for longer-term investments. So, you should avoid investing in them if you think you’ll need the money in the near future.

Direct Property Ownership

Investing in single or multi-family dwellings allows you to benefit from high rates of return. With the proper structuring, there are numerous tax advantages to investing directly in property.

Apart from the capital appreciation, you will enjoy increasing annual cash flow from the right properties.

Introducing Taxleaf

Moses Nae, CEO of TaxLeaf, Contador Miami, and the founder of Contador America is passionate about helping business owners and investors maximize their returns.

It is crucial that you consult with a knowledgeable and experienced accountant to help guide you when investing in property, especially if you are looking for ways to reduce your taxes while at the same time protecting your investment returns.

Here’s what one of our successful business owners has to say about the service and support they receive from being partnered with TaxLeaf:

Cesar Buenavista, Doral, Fl

“I am an Account Manager with TaxLeaf and have been working with clients for more than 6 years. The technology they provide is incredible. I have access to everything from my phone if I need it. They are very professional and provide excellent support for me and my employees.”

To help you learn more about how TaxLeaf can assist you with real estate investment needs, stop what you’re doing right now and click the link below.

Experienced Real Estate Investment Advisors

Or call us now to secure a FREE 30-Minute Consultation with one of our investment property solution experts.

888-Y-TAXLEAF

As your business grows, you’ll need increased support to keep track of what is going on.

Your accountant is an important part of the support system that you rely on to manage and grow your business. So, choosing the right accountant for you and your business is a pivotal decision in your life.

It is easy to get distracted by the day-to-day running of your business and avoid the more mundane tasks of keeping your accounting records up to date. This is especially true if finances and taxes are not your strong suit.

Here’s what you should look for when you choose an accountant for your business:

1. Check Their Qualifications

In matters related to tax and finances, experience, and qualifications matter.

A qualified accountant with a significant amount of tax and business experience is worth its weight in gold. They will help you to navigate the tax code as well as provide insights and advice on how to maximize your business potential.

Choose a Chartered Professional Accountant (CPA), as they have proven knowledge and experience to help you and your business.

2. Find Someone Compatible

You will spend a considerable amount of time with your accountants and their staff. For this reason, choose someone that fits your personality and risk appetite.

You don’t necessarily need to become best friends, but it helps considerably if you like the person you’ll be working with.

3. Be Selective

You want an accountant who has time for you and is a good fit for your organization.

Take time to look at what types of businesses your potential accountant works with and whether they are happy with their work.

An integral part of your business success will revolve around having the right accountant in your corner.

Introducing Taxleaf

Moses Nae, CEO of TaxLeaf, Contador Miami, and the founder of Contador America is passionate about helping business owners maximize their business potential.

It is crucial that you consult with a knowledgeable and experienced accountant to help guide you through the various stages of growth in your business.

Here’s what one of our successful business owners has to say about the service and support they receive from being partnered with TaxLeaf:

Cesar Buenavista, Doral, Fl

“I am an Account Manager with TaxLeaf and have been working with clients for more than 6 years. The technology they provide is incredible. I have access to everything from my phone if I need it. They are very professional and provide excellent support for me and my employees.”

To help you learn more about how TaxLeaf can assist you with your accounting and tax needs, stop what you’re doing right now and click the link below.

Registered Audit and Accounting Services

Alternatively, call us now to secure a FREE 30-Minute Consultation with one of our business experts.

888-Y-TAXLEAF