Journey to Multifamily Millions

Why Who You Take Tax Advice From Matters with Carlos Samaniego, Ep 123

• Tim • Season 1 • Episode 123

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Welcome to the Journey to Multifamily Millions podcast, where we speak with professionals on property investing!

Carlos Samaniego is the founder of Tax Debt Consultants and best-selling author of “How To  Make the IRS an Offer They Can’t Refuse.”

Carlos talks about his experiences working as a medic in the US Army, a paramedic, a mortgage lender, and finally, as a tax settlement specialist. Tim and Carlos discuss the value of financial literacy, the dangers of receiving incorrect tax advice via social media, and helpful advice for independent contractors, especially in the real estate industry.

Carlos stresses the importance of hiring a bookkeeper, tracking business mileage, and keeping personal and corporate finances separate. He also discusses how people get into trouble claiming real estate professional status without understanding the requirements. The discussion provides a ton of information on avoiding tax issues and what to do if you find yourself in trouble.


Episode Topics

[01:22]  Meet our guest, Carlos Samaniego
[02:30] The Tax Problem Unfolds
[06:10] Starting a Tax Consulting Business
[08:10] Importance of Financial Literacy
[14:29] Tax Issues in Real Estate Investments
[31:19]  Self-Employed Tax Tips
[37:24] What is one red flag every investor should look out for?
[37:45] What is a myth about the real estate business?
[39:03] Connecting with Carlos


Notable Quotes

  • "Before you get married—or invest in real estate—do a credit check and a tax history summary. It’s key to avoid future surprises." – Carlos Samaniego
  • "Financial literacy is a huge problem in our education system. If you don’t seek it out, you just stumble along until you screw up and ask for help." – Tim Little
  • "Nobody wants to be audited, but the key is to avoid red flags and have a professional on your side so you don’t have to deal with it in the first place." – Tim Little
  • "Hire a bookkeeper—they’ll save you money and prevent bigger financial issues later." – Carlos Samaniego
  • "A separate account makes taxes and bookkeeping much easier to manage." – Carlos Samaniego
  • "If you’re an active real estate investor, find a CPA with experience in your field—they’ll know the nuances that matter." – Tim Little




👉Connect with  Carlos Samaniego




👉 Connect with Tim

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[00:00:00] Carlos Samaniego: I was just at an event in, San Diego with a bunch of IRS criminal tax, investigators, and they are specifically targeting now real estate, social media, tax advice people because there's a lot of these people that actually promote a lot of the things that you don't even qualify for and they're also doing tax recharges. and I've had multiple people that I personally know, in our general area that are being investigated and I know them more from seeing their tax returns and trying to fix the problems after the fact, because of the things that they're trying to do on tax returns. And the IRS is not playing around with that.

[00:01:12] Tim Little: Hello, everyone, and welcome to the journey to multifamily millions. I'm your host, founder and CEO of ZANA Investments. And on today's show we have with us Carlos Samaniego. Carlos is the founder of Tax Debt Consultants and bestselling author of Make the IRS an Offer They Can't Refuse. Carlos, welcome to the show.

[00:01:31] Carlos Samaniego: Hey, thank you for having me, Tim. I'm truly thankful to be able to be on the show.

[00:01:35] Tim Little: Yeah. And it's great to have you. So we're certainly going to get into some, you know, tax saving pro tips, but before we do that, please tell us how you got started on your journey and how you got to where you are today.

[00:01:47] Carlos Samaniego: Ooh, interesting. Just like many other people,once I left high school, I ended up joining the military at a young age. 17 when I signed up for the U. S. Army. spent a few years in the military, ended up becoming a medic in the army and then ended up getting into the world of EMS. I was an ambulance driver, a paramedic for those of you guys that don't know what that is. And one of the biggest life changing things happened to me at that time. While I was working on this ambulance, I always say the older guy that was working with me, he was like the senior paramedic there. He had given me some advice because I had been working a lot of overtime during Christmas and just doing multiple 24 hour shift type of situations. And he's Carlos, why are you working so much? And I'm like, Hey, it's Christmas. Got to make some extra money. And he's Hey, all you got to do, you want to make some extra money, claim 10 exemptions on your paycheck. You're going to get a bigger paycheck. And all things are good, right? I took that advice from the older guy and did that. And obviously the year came to an end, it was time to start preparing your taxes and ended up having this big tax bill. Did a lot over time, had a big tax bill. And I did what a lot of people do, believe it or not, a lot of people do this. If I decided since I didn't have the money, I'm just not going to file the tax return. And, obviously time goes on and I'm still making some pretty good money. I've never changed that with the employer. Another year rolls by pretty quick and next year, the same thing happens. Tim, fast forward eight years later, I hadn't filed a tax return in eight years. I've been making all this money and here I am. Eight years of unfiled tax return and a huge tax bill. And what's interesting, this all happened back in the nineties and unlike today, the IRS wasn't as fast as catching up with people. Everything wasn't as computerized. I went almost six, seven, eight years before it wasn't even the IRS that caught me. It was the state of California. sends me a letter to one of my addresses and says, Hey, you haven't filed a tax return. And, unfortunately for me, that started the situation where here I am dealing with, unfiled returns for over eight years with the IRS and the state of California, almost a six figure tax bill, combined six figure tax bill, and never really did anything about it until by this time I had actually gotten out of the,the ambulance industry ended up becoming a mortgage lender with Chase Manhattan Mortgage and was working as a mortgage lender for a few years. and at that time when I was working as a mortgage lender, I had ended up meeting one of my clients that was looking to buy a house who actually turned out to be my wife. We ended up getting engaged and getting married. And then Tim, I did the scumbag move. I never told her my tax situation. And you said it right there, Tim, right? It was a scumbag move. It's a move that I now teach people what you don't do because Tim, what ended up happening, she ended up marrying it into my tax problems. And I realized what I had just done. And I knew that if I don't say something and we could talk about this in a bit, why didn't you say something? As a guy, as you would imagine, you think, if I tell her she's just going to leave me, there was this beautiful young woman that I was in love with and I don't want her to leave me. So I married her. but I realized what I did. And then I started doing a search on who can help me solve my tax issue because I didn't know who to go to when you haven't filed taxes in years and owe a whole lot of money. I ended up finding that person, right here locally, in town. He was an enrolled agent, CPA, and I went to him, I remember that Christmas, it was a couple days before Christmas, I, I went to them and I told them my situation and he said something, to me, he said, you know what Carlos, you're not a bad guy, you made a dumb decision, but we can fix this problem. And when he told me that, the weight of the world came off my shoulders. And then that's when I actually went to my wife and actually asked her. But I told her what was going on and I told her I need to sit down and talk to you. And she was like, you have that conversation with your loved one. I need to talk. She was in shock. Unfortunately, she did not divorce me. And,I told her that I found the solution and he was going to work with me and we ended up fixing the problem. And, just over almost 10 years ago, 2016, I started, I needed to make a career change. I was no longer in the real estate industry during that timeframe. I became a mortgage lender, and became a real estate agent. The whole world imploded back in 2008. So I didn't know what I was going to do. And I remember my wife saying, why don't you do what, Ernie, who's the guy that helped me. Did you help somebody with the tax problems because he had told me it while he was fixing? He goes hey if you ever want to make a career change I think you'd be really good at this. You got a lot of empathy for people And I just blew by but I remember having that conversation with my wife and she's Hey, why don't you get into the? Tax business and maybe you can help other people and here we are, in 2025, she, she's me and her, the co-founders of tax debt consultants here in Southern California and our tax practices. Our sole purpose is to only help people with tax problems. And here we are, this is what we do. She's sitting right over my left shoulder, listening in. And,not only have we helped all these people with tax problems, we even recently wrote, co wrote a book called loving taxes, how to resolve to,how to resolve IRS tax problems. And, I always forget how to resolve IRS tax problems and just keep a stronger relationship. so it's over my left shoulders, the copy of the book, but that's how we got here.

[00:07:30] Tim Little: Oh, yeah, that's awesome. It all comes back around.

[00:07:33] Carlos Samaniego: Oh yeah,

[00:07:34] Tim Little: There's, there's a couple of things. So, I mean, one, we have more in common than I thought when we hopped on here. So I. I signed the paperwork to join the army when I was 17, the delayed entry program, and then, you know, wound up going to do basic training a month after graduating high school. Like you, I did that for a couple years, but I was like, nah, I'm not a lifer. It's not for me. I wound up staying in in some capacity, but I was ready to go to college after that. Cause I, I didn't get that college experience experience and, and I was ready for it. so I wound up going to Florida state after doing a couple of years in the military. But, you know, the one thing that resonated with me was this whole, be careful who you get tax advice from, you know, because, and especially when you're young, right? Like

[00:08:20] Carlos Samaniego: reading any books on taxes for sure. it's not like, you know, my dad sat me down and said, Hey, this is how you file taxes.

[00:08:29] Tim Little: It's just, yeah, there was a place on base. You could go to get it done for free. And granted, you know, my taxes were not that complicated when I was in my early twenties, but, but still there's, it's easy to do right. But it's also easy to screw up if you

[00:08:45] Carlos Samaniego: You know what?

[00:08:46] Tim Little: some bad decisions. 

[00:08:47] Carlos Samaniego: Tim, I'm glad you brought that up because it's a thing that 's shocking. Shocking. that there's not like a basic tax 101 coming out of high school because nobody teaches this. Heck, my parents didn't tell me about taxes and I started working, right? So you almost have to learn on your own. And, it's interesting. Even my son is a graduate of the U. S. Naval Academy and he graduated and we were talking and he recently got out and he's also enrolled in Egypt. And he actually said, dad, it's crazy. I went to one of the best schools in the country and we didn't learn the basics of taxes, at a prestigious school like that. so it's not, you always hear people say, they don't teach you this in high school. Heck, they don't even teach it to you in college, unless you're taking specific accounting courses, right? That you're going to learn this stuff. which can cause havoc on your financial life, not knowing the basics.

[00:09:41] Tim Little: Yeah. Don't get me on my soapbox about the lack of financial literacy in our education system. But, it is, it is a problem. because if you don't seek it out on your own, then you just kind of stumble along or you wait until you screw up and then go ask for help, you know, kind of like you did. And unfortunately, probably a lot of people find themselves in that situation. You know, and you have plenty of people that you have the opportunity to help, I guess, which is good, but, it'd be better if we didn't have these problems in the first place. I'm trying to think of any major tax mistakes I made that early on, and I think the only one was like, buying a, a car and, or, or was it like selling a car, but then, you know, trying to avoid the taxes associated with it. And so like saying I sold it for $10 or something, and the IIRS was like, no, bro, like no way that that car, you only sold it for

[00:10:39] Carlos Samaniego: Sold for ten bucks. Exactly.

[00:10:41] Tim Little: So yeah, they get, they got me on that one. But, yeah, a couple of other things. And, and I'm glad you brought this up this whole, I don't know what to call it, like financial infidelity, like the, the honest and open, communication that we need to have, especially going into a new relationship when it comes to money, because as a society in general, we, we are very, talking about money is very taboo. You know, for whatever reasons, I'm sure there's all kinds of reasons, but in America specifically where we don't like to talk about money in public settings. Right. and so it's not always comfortable to have those conversations. And luckily with my wife, you know, we met when I was in grad school, she was doing undergrad. And by the time I graduated grad school, which is when we were dating. I had at that point six digits in school loan debt,

[00:11:38] Carlos Samaniego: a little bit from undergrad and a lot from grad, and it's just, I ignored the problem as I was taking the money. I was like, well, we've got to graduate. So, you know, just keep taking it.

[00:11:50] Tim Little: And so having about, I think it was about 130, 000 in school loan debt and she had zero. So for her. To, you know, to take on that challenge of me was a huge leap of faith. So thankfully she saw some potential in me, you know,

[00:12:09] Carlos Samaniego: lucky.

[00:12:09] Tim Little: yeah, yeah. And it, and it worked out, but it was really important for us to have a lot of those conversations up front, because when you talk about two people coming into a partnership and one having already been 130 K negative and the other person. Being at that base level, starting out their careers. It's a huge concern for me. It was a concern, right? it always felt like there was a dark cloud hanging over me. Luckily I had, I had a plan associated to attack it and I think she understood that. So

[00:12:42] Carlos Samaniego: See, and that's great to hear. And that's one of the reasons me and my wife wrote the book Love and Taxes is because, when, if people could be on my end and see how many people, how many couples. are dealing with this type of situation because you're right,the secrecy, the infant, the secrecy behind it is that nobody wants to talk about it. Who do you talk to? I know with a feeling, cause I went through that when you're eight years unfiled and have this kind of a tax debt, you're Who do you talk to? It's not, it's not like the beard. It's not like you go to the bar. It's Hey, I haven't filed my taxes in eight years. What do you think? or even worse, you're never going to tell your family, right? You don't go, you don't want them to know about it. So now you're living with this secret and have no idea on how to deal with it. And it's just what in the world are we going to do? We wrote this book because what we're trying to do is help couples that are in that situation. a lot of times, Tim, it's shocking. people will, a couple will come in here and they'll sit down and we start, when I start working on a case, we call it our discovery, our investigation to find out what's really going on. And usually one cup, one, one half of the couple are in shock. Yeah. What do you mean we haven't filed in 10 years? What do you mean we owe 200, 000? They just have no idea. And then you have the other part of the people that we have are couples that know about the problem and they're like, we ain't becoming a couple until we get the problem resolved. So yeah,it's, it's interesting the balance that's there and we're just looking to be a resource to that.

[00:14:14] Tim Little: yeah, and I, I'm sure there's the statistics somewhere in your book that show that what, what is it? You know, 50 percent of. The marriages that do fail, it's, you know, can be tied directly to money.

[00:14:25] Carlos Samaniego: Absolutely. Absolutely. Every time.

[00:14:28] Tim Little: It's a concern. All right. So this is a multifamily investment. So, so we're, we're going to transition to that. But you know, like I said, most of the people listening to this show are either invested in commercial real estate or at least interested in it. And so I'm always curious when I talk to tax professionals, what is the first question you ask a potential client if you find out they are invested in real estate?

[00:14:53] Carlos Samaniego: If I find out they're invested in real estate, I want to know, especially right now, especially over the last four years, the last four years, and you'll see how this is going to connect the last four years. The IRS has made because of covid back in 2000 and 20. They basically stopped all collection proceedings. They stopped sending out letters. They stopped filing liens, real estate liens. They stopped doing levies. Trying to come after people's money for past due balances. So because of that, there's a lot of, you'll be shocked how many people I see that owe hundreds of thousands of dollars and have no liens or levies and have actually purchased real estate either private, private residence or commercial real estates. And they were able to go through it because nothing popped up. There was no, nothing public. Here's the problem with that. And we just had one of those situations as recently, somebody had made an investment like that. And the IRS has recently started doing liens on properties for their past due balance. So now all of a sudden there's a lien on their commercial real estate. For that individual, what they owe, but they got partners. And guess what? That lien is going to have to get paid before anything can happen with that commercial property. So one of the things I'm starting to do, because I have a lot of real estate agents that reach out to me, Hey, they're trying to get people qualified. We need tax stuff. One of the things I'm doing is that you need to do a background check and there's a way of doing this: do an investigation on their tax history. Have they filed all their tax returns? Is there any money past due? that they owe in the past that's going to pop up that could potentially affect this real estate investment down the road That is critically important. It's almost again, we were talking about relationships and couples. Before you get married, you better do a credit check and maybe, and now even a tax summary of exactly what's happened in the past to make sure everything's clear.

[00:16:55] Tim Little: Yeah, no. And that makes total sense. I mean, you know, with most of the syndications that I've been a part of, the timeline associated is, you know, anywhere from, you know, four to seven years. For a lot of these deals and sometimes even more, that's a long term relationship And that that's longer than a lot of marriages So if you're going to get into that, especially for the amount of money that we're we're talking about it certainly makes sense But can you explain to me like what that looks like practically in terms of that tax background check? as we're calling it

[00:17:28] Carlos Samaniego: So what happens is like with, and, I've actually done this for real estate clients is that we can actually file what's called a, a 2848. It's a power of attorney with the IRS. and there's also a called an 8821. It's a specific form. So once we actually file that on a client, for a client, and what I always do when I'm dealing with this, I actually go back to 1990. So I let the, we were letting the IRS know that we would like access to all tax records all the way back to 1990. Now with me specifically, because I'm solving tax problems, but we can go as far back as we need it. 1990 is typically the max, but we can do that. And I will get a full page summary of every single year from 1990 to 2020, for, that's where we're at right now of every tax return that was filed, any taxes that are due, any taxes that are past due, any tax liens that are currently active, or potential tax liens are that are getting ready to be, be attached. So we can see everything that's happening. With real estate agents or investors that are trying to do something, this is a good way of just doing a good background search on somebody before jumping into an investment with somebody is like, Hey, we want, you just want to make sure there's no issue. We're not going to have an issue down the road. We want to make sure there's no issue happening and we can give them that and they can see that everything looks clear or it could be the exact opposite. you owe 300, 000 from four years ago, but there's no tax lien yet. There's going to be a tax lien eventually. So maybe we shouldn't be doing this partnership with you.

[00:19:04] Tim Little: Yeah. And you, and you've actually found that in, in some of your, checks.

[00:19:09] Carlos Samaniego: Absolutely. Absolutely. In fact, I actually have a service. It's called IRS monitor. I have a service. It's called IRS monitoring. We have clients, especially like our past, our clients that we've helped and helped out. They want me to still be an active power of attorney because I can see things that are happening with the IRS. I can even see potential audits six months ahead of time. so we can actually actively monitor everything that's happening with the IRS. So we have that ability to be able to do that.

[00:19:39] Tim Little: Interesting. Yeah. I, I hadn't heard of that one, but as part of an investor's due diligence, I think that would be an interesting addition to that, now you talked about audits for anyone who's investing in, in real estate, you know, be it actively or passively, is there. Are there any triggers that they should think about in terms of something that might flag them for the IRS for an audit? something that they can know ahead of time would be a red flag, that they can kind of avoid because nobody, nobody wants to be audited. I mean, they shouldn't be worried if they have a, you know, a professional working on their side, but still it's better to just not have to deal with it in the first place.

 

[00:21:00] Carlos Samaniego: no, absolutely. Absolutely. one of the ones I talk about almost every year on Fox. They call me up every year during tax time to do an interview and it's shocking. We're old enough to remember, when it was time to do your taxes, we waited for our W2, 1099s to all show up in the mailbox, right? Once we got everything, we were going to go to the tax guy. About five or six years ago something dramatically changed where and it's almost to the point where a hundred percent of all tax documents are now emailed to you and you're given a notice, you know your tax documents are available to download at their website, right? So I've had multiple situations where people were audited. They get a little notice. It's called a CP 2, 000 notice. It's basically We're changing your, your tax return because you forgot to include x. Either it was a 1099, a w2, especially going forward because 1099 requirements are dramatically changing in terms of, getting, smaller. I think this year, if you make more than a thousand dollars, you're going to get a 1099 from people, from the different entities out there. That's a simple one because a lot of people forget to, especially self employed people forget to report all their income. And I actually had a realist. Oh, this is a wild one. I had a real estate broker that I was doing my active monitoring and it, her, my computer got flagged for her account because the IRS said she under-reported almost 800, 000 of income. And I immediately saw that. So I contacted her and I'm like, Hey, you got flagged for an audit because you underreported 800, 000 of income. And she's like, how is that possible? I didn't. And what we ended up finding out was as a real estate broker, she was getting commissions and all the commissions were coming to her social security number. But what happened is that she actually had incorporated her business and forgot to change. the tax ID number on the 1099s. So she reported all her income on her corporate return and filed a return, but all the income got reported to her personally. So the government is looking for all that income to be on her tax return and it's not there. So they're just thinking she under-reported hundreds of thousands of dollars there. So luckily for her, she was able to, she got the, I gave her the forms that she needed from the IRS that her tax accountants were able to look at it. They're like, Oh, we see what happened here and they were able to make the change to prevent any penalties and interests. One of the big ones is underreporting income. And the other one,going back to taxes is that. Expenses, be careful of your expenses. If you're going to report your expenses, make sure they're reported correctly on a tax return. and a lot of times where we see the challenges here is because people are trying to do it themselves. They try to do it themselves and they're, it's a legitimate expense, but they're putting it in the wrong place. Which causes, and usually the wrong place is they always put everything on other, on a schedule C. There's a line for other expenses. Which I always tell people that is the most audited part of a tax return because the IRS can't see what other is. All they see is a huge number in there. So now they're just going to flag you for an audit and they're going to reach out to you, explain the other,

[00:24:21] Tim Little: Yeah, and sometimes I just feel bad for my CPA because of what I said to him and I'm trusting him to put it in the right places there in terms of the expenses, right? And so I maintain and we can get into this talking about, you know, being self employed, right? Or, I have a business bank account. I also have a personal bank account. I keep them separate. I was told at some point that that's the first rule. Keep them separated, right? Segregate your accounts, and never the two shall meet. And then that's a good way to at least start. 

[00:24:58] Carlos Samaniego: the best it's one of the best rules period

[00:25:00] Tim Little: yeah,

[00:25:01] Carlos Samaniego: so many people we just mingled their money. It's just like how do we even separate this thing?

[00:25:07] Tim Little: exactly. And so, you know, I usually just, you know, send all the expenses. Hey, here's my business credit card. Here's everything that I spent on it. And he'll have questions, of course. Well, okay. Well, what was this for? Okay. This is legitimate. This is not. and then I have to, you know, in terms of, we'll, we'll get into some more advanced stuff here in a second, but yeah, the first rule, you know, if people take nothing else from this, if they, they have an LLC. then make sure that they have segregated accounts, i. e. a personal account and their, their business account, which has an EIN associated with it.

[00:25:47] Carlos Samaniego: and I'll even take it a step further on that. It's just I just tell people Eat whether you have an LLC or S Corp or not If you're just if you got a business if you're doing business You Just have a separate account doesn't even have to be a business bank account Just a separate account that you use only for business Deposit all your income that you're making in there and make all your expenses It just makes the job of doing the taxes or your bookkeeping so much easier than trying to separate Okay, this was for volleyball for the for our daughter and this was for business. Yeah, it just It gets interesting there Yeah

[00:26:21] Tim Little: messy when you get into the more advanced stuff, which was what I was going to go into. So for about two years, I was doing, you know, nothing but real estate. Right. So I was claiming real estate professional status. And so I'd be eager for you to talk about this. because, some on like tick tock or whatever else will, will make it sound like it's the Holy grail and so easy, but there are requirements associated with this. And, you know, there's some bottom line stuff that you need to meet. And then for compliance, there's some things that you need to do in order to stay within it because the benefits can be significant, but if you're, if one, you don't meet the criteria. Then obviously it won't work for you. But even after you meet the criteria, if you're not tracking the right way, then the IRS may not choose to recognize it. So can you talk a little bit about real estate professional status, who it's actually for and what the requirements are for that?

[00:27:26] Carlos Samaniego: It's interesting. I lost you there for a second. What's interesting is that real estate investment status is an excellent status if you qualify and the requirements are pretty stringent. you basically have to be doing real estate investment full time,if you're, it's funny. I have a friend. I don't personally do tax returns because I just deal with the I. R. S. Collection stuff. I have people on my staff that actually do the returns. But one of the girls that was just talking about this and she was telling me that real estate investment status, if you've got somebody that's working full time as an example as a nurse and they do real estate on the side, the chances of them getting real estate investment status are slim to none. Because the hours that are required, and I don't know the exact hours, it literally changes on a yearly basis. The hours that are required, there's just no way you're going to be able to prove that you are actually working full time as a real person, to qualify for the real estate investment status. All I can really say is that when it comes down to it, if you're thinking about taking advantage of that status, you need to work with a real estate agent that specifically specializes in that. in real estate agents, on getting that investment status and don't please, please don't. Take advice from online social media tax people. Tim, I was just at an event in San Diego with a bunch of IRS criminal, criminal tax, investigators, and they are specifically targeting real estate, social media, tax advice people. because there, there's a lot of these people that actually promote a lot of the things that you don't even qualify for, and they're also doing tax recharges and I've had multiple people that I personally know, in our general area that are being investigated and and and and I know them more from seeing their tax returns and trying to fix the problems after the fact, because of the things that they're trying to do on tax returns. And the IRS is not playing around with getting off your social media tax advice, what you want to be talking to, you want to be talking to. a CPA, a tax attorney, or an enrolled agent. That's exactly, that's what I am. an enrolled agent that really specializes in, in the tax industry, in the real estate industry, excuse me.

[00:29:41] Tim Little: Yeah, I couldn't agree more. And that's one thing that I emphasize to people. You know, like not just finding a CPA, but someone who has, if, if you are like, especially an active real estate investor, like this is your, your bread and butter, then find someone who has experience. In that field they know the nuances because just like law tax has different nuances based on You know the job that you're doing and so you want to seek out those professionals who have that specific Skill set for what you do.

[00:30:15] Carlos Samaniego: No, exactly. It's just, every industry has their own little nuances and the tax industry is so nuanced. Even the, even what I do is very nuanced. less than 2% I just recently heard a statistic. There's less than 300 firms in the country that do exactly what I do. They spend 100 percent of their time fighting the IRS and resolving tax issues. So it's a very nuanced field and real estate investment. Again, that is very nuanced and you want to find somebody that has multiple. Years of experience doing that because anybody can say, Oh yeah, I do that. But if all of a sudden you end up taking advantage of certain tax deductions that you didn't qualify for. Here's the negative part about this, Tim, they don't find out the year you did it. They find out three years down the road and then they're collecting penalties and interest for those three years. and then sometimes they can even,and certainly instances, it can be six years down the road. But yeah, you got to be really careful with that.

[00:31:19] Tim Little: All right, and then let's let's pull back a little bit just in terms of Folks who may be self employed because some, some people, you know, whether they're doing it full time or maybe they just have an LLC and like you, like you recommended, right? They have a business for investing that they're doing. What are the biggest landmines in general that you see people step on when it comes to the whole, self employed piece and or what tax advantages are, are they missing that they should be taking advantage of?

[00:31:49] Carlos Samaniego: Yeah. Self employed people. This is my bread and butter is, one, the first thing that they're missing, we already talked about it, so I'll just briefly mention it, is keeping your, your checking account separate. Keep, you have a separate bank account. That is. By far the best thing you could possibly do. Makes things much easier. That's the first thing. The second thing is, and I talked about this earlier on the podcast, is to understand that the money that you've earned is not all your money. Way too many people make this mistake thinking that they're in business for themselves, they make 5, 000, 10, 000, 10, 000, whatever it might be, and they think all of it is their money. No, there's somebody called the IRS and if you're in a state that collects state income tax, they want their portion of that. So you have to save a portion of that money, typically 20-25 percent to the side to pay for your taxes that you're going to end up paying. It's a must. You have to do that. Otherwise, you're going to end up like a, I have a lot of real estate people that did really well the last 10 years really well and a lot of them ended up with some huge tax bills and They just and i'm talking to tim average tax bills probably between 100 to 200 000 tax bills And the reason is that and if I was a real estate person I was a commissioned loan officer and I was a commissioned real estate agent And we all know when we're getting that commission is already spent before you've even gotten the check 110 percent of that, I'm going to go buy this and go do this and go on this vacation and buy this new car. The problem is they all, here's what they're all thinking. You know what my next commission check is, I'm going to use it for taxes. Guess what? That never happens because you've already spent it for something else. So just understand that you got to save money, to pay your taxes. And then the other, big tax thing that people aren't taking advantage of is really, a vehicle, especially in the real estate. You do a lot of driving, looking at properties. It's just keeping track of your miles, because your vehicle can be one of the biggest tax benefits, tax deductions you can have in your tax return. And one of the requirements of taking that deduction is you got to keep track of your miles and nobody does this. And it's the most highly audited portion. That the IRS goes for, and it's as simple as there's a simple app called MileIQ, M-I-L-I-E iq, MileIQ a simple app, you can put it on your phone. I got it on my phone, and it tracks all your miles automatically. So you literally just swipe left of its personal, swipe right of its business. It's, and you have an audit proof thing to possibly take 6, 10, 15, $20,000 off your tax. Simple things like that. And then the final one I tell people is hire a bookkeeper. It's the best possible money you can ever spend. Even if it's a bookkeeper that just looks at your books, looks at your checking account on a quarterly basis, that bookkeeper will pay itself 10 times over because they're going to be able to keep track and kind of keep you on track of what's your potential tax bill that's going to happen. And keep track of all your deductions and at least keep you financially on track so you don't end up having to hire a person like me.

[00:35:02] Tim Little: Yeah, and I mean, I understand not, not doing the miles because everyone's like, Oh, it's a pain. I don't want to do it. So I'm glad they're at least coming out with apps now that make it easier because no one feels like coming back after the end of the day and Opening up a spreadsheet and putting in 20 miles each way to look at this property but you know, if, like you said, if you don't want to get audited and you're claiming, you know, that, that mileage, then you, you have to put it on there. You have to track it, say what it was for and show that it was a legitimate. A business purpose, right? That's what they're looking for.

[00:35:42] Carlos Samaniego: Absolutely. And it's, I've been in a couple of audits where they've actually audited that. And, it's interesting, you just jump on your f for your app, send a report that sends it to you. I literally hand it to the IRS officials, they look at it, looks good, and they just bypass that altogether. it, it's a great app. MileIQ

[00:36:01] Tim Little: Yeah. And you talked about the bookkeeper being such a key part of basically keeping you out of trouble. and I guess I would ask, so what are your thoughts on more automated solutions like quick in or, or something like that? It, are they, do they compare or

[00:36:18] Carlos Samaniego: yeah, no, that's a great question. I, for years, used to recommend Quicken and things like that, but here's what I've experienced. Everybody gets it, nobody ever follows up with it and does it the way they're supposed to. Nobody does. I have yet to find one of all the clients I've recommended to it. We jump in there and we take a look at it. It's like the last time you logged in here was four months ago. That's why you're,unless you really love doing that type of work. And if you do, maybe you should be a bookkeeper, but, you know what? Our high dollar value, especially for people in the real estate industry, is either looking for investments or selling real estate or whatever your job is not spending, a good bookkeeper might cost you 10, 15, 20 bucks an hour and there might, they might only need a few hours a quarter to do that. It might be well worth the price.

[00:37:10] Tim Little: No, that's, that's good advice. All right. Well, we do need to move into the turbo round. So I'm going to ask you three questions that I ask every guest on the show, and I just asked for a quick, honest answer. Are you ready?

[00:37:22] Carlos Samaniego: Yeah.

[00:37:22] Tim Little: All right, first one. What is a red flag every investor should look out for?

[00:37:27] Carlos Samaniego: Every investor should look out for, literally, potential tax issues. Especially if you're in a partnership, I think that's, we talked about that earlier. More so now than ever, because again, the last four or five years, the IRS has done nothing. So you may not know something that might be coming up on the horizon.

[00:37:43] Tim Little: Yep. All right. Second one. What is a myth about this business you would like to set straight?

[00:37:48] Carlos Samaniego: A myth about the business, specifically that I do, is that the IRS is just looking to pound on you. Here's what the IRS is doing. They really truly want to help you. The problem is most people just avoid them. And if when you avoid them, the IRS has, the only option they have is to pound on you. But if you're willing to come up, Speak to them or better yet have someone like myself speak to them They will find a resolution that will fit you and your current financial situation

[00:38:16] Tim Little: All right, I think that's fair. All right, final question. What does success look like to you?

[00:38:21] Carlos Samaniego: Move that has changed dramatically since my 20s and I'm 56 now I truly believe now true success is health I've seen way too many people just in the last year friends close friends family members You That, I've either been diagnosed with cancer, a lot of cancer, recently and I just think that, what is success if you don't have your health? It really is. I truly think success is health. We've got to take care of ourselves.

[00:38:49] Tim Little: yeah, absolutely. You have to have that quality of life. All right. Well, Carlos, this has been awesome. I appreciate all the tax tips that you've provided us. Please tell our listeners how they can get a hold of you. And if there's anything else you'd like to share with them.

[00:39:03] Carlos Samaniego: Oh, absolutely. my website's taxdebtconsultant.com. It's literally, it's a singular tax debt consultant. But the best thing they can do, if you want to get a copy of my free book, “How to Make the IRS an Offer They Can't Refuse”, go to taxdebtbook.com and you can get a free PDF version of this book. And I'll be mailing you a copy, Tim. So that's it.

[00:39:24] Tim Little: All right. Well, again, appreciate you having on, having you on and, the, the little freebies there for our listeners. We will have all that information in the show notes. Thank you for coming on and look forward to continuing to see you do big things on your journey. Carlos.

[00:39:37] Carlos Samaniego: Thank you, Tim. Truly appreciate it. Bye

[00:39:39] Tim Little: Take care.

 


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