A CPA couple started buying property after helping real estate investors save big on taxes. Their clients gave them a ‘cheat code’ to successful investing.
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Amanda Han and Matthew MacFarland leveraged real estate for tax benefits and income.
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They began investing in 2008 and focused on finding deals that would produce positive cash flow.
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Their portfolio includes rentals and syndications, balancing active and passive investments.
Amanda Han and Matthew MacFarland stumbled into real estate early in their careers. They were both working at a Big Four accounting firm and were placed in the real estate group.
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“That was sort of just by chance. They put you where they put you,” Han told Business Insider.
She’d never been interested in property investing. She grew up watching her parents and grandparents spend hours on their own real estate portfolios.
“They were super hands-on,” said Han. She didn’t think that type of active investment was for her, but as she and MacFarland spent more and more time working with real estate investors in their day jobs, the couple couldn’t ignore the tax benefits.
The “aha moment” came for MacFarland a few years into his tax manager job.
“I was reviewing somebody’s tax return, probably a gentleman in his 60s. He was retired and all he had going on was real estate,” recalled MacFarland. “From looking at his tax return, this guy was making money in real estate — cash flow — and not paying any taxes on it because of the depreciation. And I was like, ‘Hey, there’s something here.'”
It took Han a little bit longer to come around, but when her dad got sick, it highlighted the importance of having a backup revenue stream.
“You need to have another source of income because otherwise, no matter how high-paying your job is, if you have to stop working, you no longer have money,” she said. “So I then started agreeing with Matt to look into real estate.”
Han and MacFarland bought their first investment property around the same time they started their own firm, Keystone CPA, in 2008.
Despite doing real estate adjacent work for years, “we were new to wearing an investor hat, so I think we had a lot of the same uncertainties and concerns that most new investors have,” said Han.
The California-based couple chose to start in a more affordable market and settled on Las Vegas, where Han grew up and still had family. From there, they started looking at properties online. Their priority was to find something that would produce positive cash flow.
They were purchasing amid the 2008 housing crash, “so we really doubted whether we were doing the right thing,” said Han. But running numbers through the cash flow calculator they built in Excel, and considering exit strategies, eased their anxieties. “We just ran the numbers and said, ‘Okay, these numbers make sense. Let’s do it,’ as scary as it seemed at the time.”
