Accountant for Real Estate Team. iStockPhoto

For business structure planning:

Most real estate investors start out small, bird-dogging or doing other wholesale investment strategies that require little or none of their own money. And, they are usually not setting up any special business structure at that point, remaining sole proprietors until they see how things go.

However, once things do start to progress, you’ll want the advice of an accounting professional as to the best forms of business structure for tax purposes. Your attorney will tell you about incorporating for liability reasons, but your accountant will give you more information about how to structure for tax savings.

Getting organized for efficiency:

Successful real estate investors don’t get that way sitting around going over financial spreadsheets and searching for receipts. They are successful because of their marketing and using it to get in front of buyers and sellers to put deals together.

Your accountant can help you to set up a system that will assure that you aren’t completely overwhelmed at the end of the year. They can help you to record your expenses and income in an efficient way, and to not miss any deductions you should be taking.

Growth & using leverage:

The most successful real estate investors who own properties have become experts at using leverage to acquire more of them. Your accountant can show you how leverage can be used intelligently and at lower risk to grow your holdings.

Tax advantages of using leverage are also an important consideration, and an accounting professional can help you to plan smart growth of your business with lower taxes as a basic business plan factor.

Your accountant is your partner in growth:

Take the time necessary, and be very thorough in selecting an accountant for your new real estate investing business. You’ll want someone you can trust, and you’ll want someone aggressive enough to save you money and increase your ROI, yet conservative enough to keep you out of trouble with the tax man.

Even if you start out throwing receipts into a shoe box, at some point your success as a real estate investor will require that you do more planning and definitely take a look at your return on investment as it’s related to your risks. An accounting professional can help you to grow intelligently and to take advantage of the many tax strategies involved in real estate investing.