Brandon Burns is a Senior Vice President at Investors 1031 Exchange with a focus on sales and marketing for the company. Brandon is a very experienced commercial real estate executive who has served on the investment committees over several real estate capital firms throughout his career. He has been involved in over one billion dollars of real estate development and acquisitions and has helped acquire 64 projects that have gone full cycle across many asset classes.

He has raised over $600M in equity for various real estate projects and was instrumental in successfully issuing $180M of debt on the Tel Aviv Stock. Brandon has undergraduate degrees in real estate, as well as finance; from Baylor University.

 

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Tax Reform a CRE & 1031 Game Changer with Brandon Burns

 

Brett:

Hey, I’m excited about our next guest. He’s out of the great city of San Diego, and he’s a senior vice president at Investors 1031 Exchange with a focus on sales and marketing for the company. He’s a very experienced commercial real estate executive who has served on the investment committees over several real estate capital firms throughout his career. And he has been involved in over $1 billion of real estate development and acquisitions and has helped acquire 64 projects that have gone full cycle across many asset classes. He has raised over $600 million in equity for various Real Estate projects. And it was very instrumental in successfully issuing $108 million of debt on the Tel Aviv stock. Our guest has an undergraduate degree in real estate, as well as finance from Baylor University, please welcome to show me, Brandon Burns. Hey, Brandon, how you doing, sir?

Brandon:

Brett. It’s a pleasure to be here. Thanks for taking the time and giving me the opportunity to join you here.

Brett:

Absolutely. And for our listeners to get to know for the first time would you give us a little bit more about your story and your current focus?

Brandon:

Absolutely. So today, I’m a Qualified Intermediary. So my firm facilitates 1031 exchanges, helping clients fully defer all of their taxes at the time of sale. Prior to that I worked for a number of real estate investment groups, developer, family office developer, sat on the Investment Committee, and was honored to be a part of some great transactions. But nothing makes me happier today than helping my clients fully avoid paying taxes. It’s just the worst when you have to give up money to Uncle Sam.

Brett:

Yeah, absolutely. That’s been in California, and on the front lines of, let’s say, high appreciation and also high taxes, we definitely share that value. And before we dive into, the potential tax reform tax rate that’s on the table, and the potential changes in commercial real estate in the center of the 1031 exchange, I want to take one step back, Brandon, and help our listeners and myself get to know you a little bit better. You know, I believe we’ve all been given certain gifts in this life. Some people call them superpowers or strengths. And I believe the God-given gifts they gave to us to be a blessing and help to others. So I want you to go back maybe to your high school days, university days at Baylor, and maybe help us understand maybe one or two gifts that you believe your big you’ve been given? And how does it help how you help it bless people today?

Brandon:

Yeah, absolutely. So it’s interesting to me when I was a young college student, my father owns an accounting firm, and I thought that I potentially could follow in his footsteps. And after taking some detailed accounting courses, I realized that if I spent my entire life looking at the past, then I didn’t know that that would make me happy. So I was fortunate enough to take a real estate finance class, and then dual major in finance and real estate. And you know, it’s just, it’s, it’s really awesome to me to be able to look and say, Okay, I can essentially do insider trading with real estate, right? If if you invest in the stock market, and you know, more than someone else, and you trade on that information, that’s illegal. That’s the definition of insider trading. In real estate, if you know more than other people, and you make moves based on that information, you make money. And that’s something that I really think is powerful about real estate, I think that’s powerful about investing, you know, being able to remove, you know, some of the risks, and, you know, have more information than other people just makes me more comfortable as I invest my dollars.

Brett:

So the idea of forward-looking and being able to take the information and see those things that other people may not see or be willing to do the work to uncover right with real estate. And then helping others act on that information. Is that a fair summary?

Brandon:

Absolutely. That’s very fair.

Brett:

Love it. Beautiful. So now let’s dive right into, big challenges that are in the room for commercial real estate, the 1031 exchange, and that’s tax reform. So buying has come out. And it said a few different things right about the 1031 exchange, potentially limiting it and also the stepped-up basis, potentially limiting or eliminating that. So let’s just start with the big macro. What what are you seeing in the 1031 world, what concerns you, and then let’s dive into maybe You know, what’s the outcome of these things?

Brandon:

Great question. I think there’s a number of headwinds that are facing real estate investment investors today, both at the local and federal level. Everyone has a different local level. So I don’t want to dive into that too much. But at a high level, you know, California or other places that are facing housing issues are trying to figure out how to regulate some of the Airbnb putting some restrictive controls around that other states are trying to put rent control in place. And so that’s one headwind, but at the federal level, you know, Biden has come out the Biden administration, they need to figure out how to fund some of the things that they want to fund. Many people don’t know, but the amount of money in circulation went up by approximately 40%. In 2020. The St. Louis Federal Reserve actually tracks that they discontinued their tracking because it went up so dramatically recently. That I’m not sure exactly what the rationale was behind that. But that where they stopped tracking it, there was 40% more money out there. So, you know, that was issued by the government for the most part, right. Secondly, the Biden administration wants to do some some some really, potentially cool and interesting things, where, you know, eliminating student loans, for some folks going in and making healthcare more affordable than it already is making it more available than it already is. But the real question is, at some point, you have to figure out how to pay for that. Right? So the Biden administration is facing this, this, this large, looming question of how do we pay for all these programs? And how do we figure out how to slow down the deficit that has recently been created. So there’s, they’ve come out and, and had some language around different parts of, of the taxation, I’ve paid primary attention to things that affect real estate investors. So the kind of key things that affect real estate investors today, first of all, Biden recently came out and said, he wants to increase the long-term capital gains rate to be higher than the highest short-term marginal tax rate. He said he wants to increase it, they’re going to propose, which they haven’t yet said, He’s going to propose a long, high highest tax bracket long term Federal Capital gains of 43.6%. So that’ll raise taxes on long-term real estate investors or any long-term investors by approximately 23%. So that can be aggressive. Secondly, Biden has said he wants to potentially limit or, or, or remove 1031 exchanges for people. He originally came out about this time last year and said he’s going to remove it completely. He then came out last September, and said, He’s going to remove it for anyone who makes over $400,000 a year adjusted gross income on their tax return. And then most recently, last month, he came out and said, he wants it to be ineligible for anyone who makes over $500,000. So again, you know, these aren’t things that happen, these are things that are potentially going to be proposed. And there may be some loopholes. You know, how do you define a profit of $500,000? Right, you know, you cut your property up into multiple properties Do you potentially be able to play with debt, and I’m not sure how that’s going to be defined. But I do think it’s potentially going to be a little bit more challenging in the future to do a 1031 exchange. So, you know, one of the things that I talk about with people that come and ask me for advisors, their planning is, you know, we don’t know exactly what’s going to happen. However, if you’re looking to potentially do a 1031 exchange, in the next, you know, one to five years, it probably makes sense to evaluate accelerating that timeline. Because the worst-case situation that no one wants to be and is to turn around need to sell the real estate asset that you’ve deferred taxes on for 15 2030 years, suddenly be in a situation where 1031 may not be eligible for you. And you’re looking at, you know, a really aggressive taxable event. If if you’re in a tax bracket of 43%, long-term Federal Capital Gains, then you’re also in a state that charges you no state income tax, California is about 10. Colorado is about for many other states to have some type of, of, you know, state taxes.

You also have a depreciation recapture tax, where you have to pay back 25% of whatever you’ve depreciated. So if you’ve owned a property for, you know, 10 1520 years, and you’ve depreciated it considerably or fully, that can add an extra 10 25% tax burden. So, you know, if you were to look at a situation where you’ve got 25 years of built-up tax deferrals, and you fully depreciated your asset, you might be In a 60 or 65%, tax bracket, and that would justify that would that’s heartbreaking. That’s, you know, a terrible place to be. So, you know, for folks that are looking to potentially do an exchange. I think with good data, you can make good decisions with that data, you make random decisions, it makes sense to evaluate moving up that timeline.

Brett:

Yeah, I just staggering stats there. And you said, it’s so well, right and increasing, especially increasing the long-term capital gains tax rate up by about 23%. So he’s looking at taking to federal at 20 to 39.6. And then you add Obamacare on top of that, as the state of California, for example, is 13.3. Right. So the minimum I always say is 37%, for investment property inside of California, did you add depreciation recapture. But the 37 plus the 20, make it 57. And then depreciation recapture could be anywhere from 3 5 to 10. Looking at 70%, I mean, this is like this is insane, right is really what it comes down to someone works for 10 2030 years. And the other point, which is really interesting, I think he kind of touched on a little bit. It’s like who’s making $500,000? So I think there’s a study that was recently done by the Tax Foundation, and they found that this, the part about Biden was proposing was, Hey, you know, look, it’s about 500,000 500,000 Americans this little effect, well, what this what he’s not affecting is each year, that changes who’s making that 500. In other words, somebody might have a property that’s worth a million dollars, let’s just say they’ve been making 100 220 for 20 years. But now when they go to sell that, guess what all of a sudden they’re making 500 in that given year, or depending on how they dissect this. So that affects millions and millions and millions of people. And when you look out on that sale, you go, No, it doesn’t make any sense. These are ultra-rich people. These are folks that put blood sweat, and tears for 10 2030 years, invested saved, manage their property for the community, and now they’re gonna get wiped out. So obviously, you can tell aside, Brandon and I are on. And once you’re closer to these folks who have built wealth, who’s in real estate and doing the 1031 exchange, it’s just devastating to think about that. Why do you think the Biden administration is targeting Tim 31? In particular, is there any insight to that run that you figured out?

Brandon:

So you know, a lot of times I have people ask me, you know, hey, due to the pandemic, are there any things that have come out that that can help us right. And at the beginning of the pandemic, there was a little bit of help. One of the rules for a 1031 exchange is a time component, where you have 45 days to identify a number of properties that you may or may not purchase, and 180 days to close on one or more of those properties in a tax-deferred situation. So at this point, last year, they gave a little bit more time on that 45 days, they gave it was either to July 15 or 45 days, whichever was longer. But that that help is burned off, right. So I believe that the government sees people who have significant wealth through real estate as really wealthy people. And I think that’s the wrong way to look at it. I recently had a client who was a teacher. And when she was 28 years old, someone mentioned to her and said, Hey, you should spend your summer working, save up enough money to buy a duplex, because real estate is really how normal people can build wealth. And so she took two summers at 2829 worked, you know, some kind of long hours terrible job instead of vacationing with her other teacher friends over the summer. And she saved up enough for a small downpayment on a duplex. She’s now on her fourth exchange, and she’s generating about $6,000 a month of mostly tax-free income because there are some great tax strategies around real estate income. And she’s consistently exchanged and she hasn’t, you know, had some large taxable event that fit into that equity. She’s using it as a cash flow vehicle. And it’s changed her life, right, as a teacher, she does have a pension, but it’s not substantial. And this extra $6,000 a month has allowed her to live a much higher quality of life. And, you know, unfortunately, she’s the kind of person that is going to be impacted. She’s going to be stuck in this property should this legislation go through, she’s now going to be stuck. It’s stuck in this property forever. Luckily for her, I think she just did an exchange, she’s probably fine for the next, you know, 10 to 15 years. But you know, there are folks that are not right. I was you know, right before this, this meeting, I was actually on the phone with somebody and we were kind of talking about game planning and tax planning because he owns an Airbnb rental in San Diego and San Diego has come in and they’re limiting the amount of Airbnb ease they’re, you know, they’re trying to figure out how to deal with this, you know, with potential housing crisis and how do we, you know, instead of taking these homes that are many hotels, how do we put them back in a long term rental market, and he feels like his income is going to drop by 30 or 40%. So he needs to sell his property to kind of While he still can add value, and, you know, we were kind of talking through this, he told me, Brandon, you know, there’s so much of my net worth so much of my retirement tied up in this property that, you know, should I do a misstep here? Or should there be, you know, 50 60 70%, you know, gouge from the government into, you know, what I’ve planned for that’s, that’s just devastating, I don’t know that I could recover at this point in life.  So you know, those are the kinds of conversations that you know, truly break my heart as I talk to clients.

Brett:

Absolutely. And by the way, I’m having a backup plan for a failed 1031 exchange or alternative sometimes can be really a lifesaver for these situations. We just helped a client, he on 3030 years of commercial real estate value add multifamily, started out as a broker built up his portfolio. And this is right before COVID. Right. And so he’s looking around for deals, he sold a $7.6 million deal in Georgia, he searched around, and he’s looking at these four and a half, five cap deals that have been squeezed out with the cash flow right or squeezed out of the upside, still have minimal cash flow, and he’s going off, I want to pay for this, then COVID hit and then he’s like, I definitely don’t want to jump into something, you know, got very cautious. And he passed 45-day identification. And so he was able to use our strategy called the deferred sales trust to give a chance to all to save the failed 1031 and defer the tax and then diversify, pay off his debt and just sit on the sidelines. And so I’m curious, I don’t know if you’ve heard of the deferred sale search, Brandon, what are your thoughts on alternatives? But what would be able to save a failed 1031 exchange mean for clients or just have a backup plan in case it fails?

 

Tax Reform a CRE & 1031 Game Changer with Brandon Burns

Tax Reform a CRE & 1031 Game Changer: “Make sure you pay your taxes; otherwise you can get in a lot of trouble.”–Richard M. Nixon

 

Brandon:

I think it’s important to have a backup plan, you know, the worst thing you can possibly do is have to write a 500,000 1,000,002 million dollar check to Uncle Sam, just because you didn’t explore the options that are in front of you. You know, one of my kinds of catch racing that I like to use is with a good game, you can make good decisions with bad data, we make random decisions. And so, you know, I think that’s really helpful. And, you know, obviously, anyone that’s listening to this or watching this, you know, I would just really encourage you to make sure that you have all the data so that you can make the best decision for you. And, and hopefully be in a situation where you can avoid having to write such a large, you know, check to Uncle Sam, that’s Yeah, that’s the goal of all this is to avoid that.

Brett:

Exactly. Yep. And you go to capitalgainstaxsolutions.com tomorrow, learn more about the deferred sales trust. So starting on a Marcus and Millichap Brandon, you know, we learned about the 1031 exchange and about day three, right? And then I started helping people do it right. It’s 2006. And everyone’s high. fiving, right. Oh, five, you know, you know, by now, people love to be sellers, but they hated to be the buyer. So they felt like they’re overpaying right? Low inventory, low-interest rate, high values, competing, competing, competing, and then the music stopped. And they’re looking around going, Oh, my gosh, like, what am I gonna do? And so I went, you know, my story is I went from making some money markets like nothing overnight, and all of a sudden, my clients were fighting with the banks and had too much debt and not enough diversification of liquidity. Long story short, I remember the deferred sales trust business started to grow help the clients now do something different. But the 1031 exchange is interesting. It only applies to investment property, right? It’s not just Biden, who’s put this thing under fire. This thing’s been under fire for years. And Trump and their administration, they further the limited down to essentially investment property, right. And so there are people who are selling high-end primary homes that 1031 does not qualify for businesses, right. I’m helping people with cryptocurrency right now. Public stock private stock. And you can essentially now sell defer capital gains tax using the deferred sales trust, and then via an LLC partnership, go and buy real estate. So it’s kind of like 1030, wanting, you know, crypto or business into more real estate. So I’m curious about, you know, 1031. I feel like they should just open it up to more things, right. They should not just limit it down to investment, real estate, that increases commerce builds macro, the macroeconomics. So let’s talk about the macro the good things about the 1031. And how if we could open it up to more things that would actually spur more economic growth, more tax revenue, and actually be more beneficial for what the what we believe the Biden’s administration is trying to achieve.

Brandon:

I agree, you know, that 1031 exchange, can be powerful to help you avoid taxes, but it’s certainly limited right. So you have a time component, the 45 days to identify properties, you may or may not buy 180 days to purchase something you identified. Secondly, you have to purchase the same amount or more of your net sales price. So if you sell a property for a million dollars, and you have $50,000 of transaction costs, you have to purchase a property for 950,000 or more, which isn’t always ideal for people but that is one of the rules for the 1031 exchange. You also have to have continuity of title which isn’t an issue but can be an issue. I just had a client cancel an exchange, because they were under contract to purchase a new property, they’d sold it in a family trust. And the last second, the bank decided they weren’t going to loan to the trust, they would only loan him personally. And the 1031 exchange wouldn’t. Wasn’t a vehicle where that could happen. So he had to choose between either losing his property, finding another lender, or paying taxes, and he chose to pay taxes. So there are definitely some limitations to a 1031 exchange, and if something doesn’t fit in that box, and you know, it’s important to understand what other options are available, you know, a deferred sales trust can be a great option if something isn’t a fit for an exchange.

Brett:

Yeah, no, thanks for sharing that, um, new depreciation schedules, right. So one of the main reasons to own real estate is the depreciation to offset the income right and or at some cost Saigon another deal, and maybe even eliminate some capital gains tax in a given year. If you own real estate, let’s say we’re 27 and a half years, or you’ve done 1031 exchanges, when the depreciation schedule travels, right, you can run out of that depreciation. So what would a brand new depreciation schedule mean? For 1031? clients if for some reason they decided to allow that?

Brandon:

Yeah, you know, like, as you said, depreciation is, is one of the really powerful things for owning real estate, right? If you can have income, that some portion or all of it isn’t taxable, and then potentially have other depreciation that you can write off that against, you know, other income that you have, you know, some of the mission was cost segregation. That’s where I’m obviously you know, about that, but for the listeners that don’t, that’s where an engineering firm comes in and can accelerate a large percentage of your property’s depreciation into a five to 10-year schedule. And so it allows you to really push a lot of that depreciation forward. And, and that’s, that’s one of the really powerful things that helps real estate investors avoid taxes, not only on the income from real estate but also able to offset their other income. But the more in general that you can do with that, you know, the better off you are, and that’s, that’s why I think Trump, you know, didn’t want to release his tax returns, right? Is because you could see some of them, he has advantages as a real estate investor, where you don’t have to pay some of these taxes A lot of times, especially when you have a lot of property, and you can do some advanced planning. So, it can be very, very powerful to have to reset your depreciation schedule or to, you know, accelerate depreciation into the first five to 10 years to property for sure. 

Brett:

Awesome. The next lesson, next thing has always been, you know, we learned to drop into your swap, swap into the drop, right, and then get this stepped-up basis, and kids walk away from tax-free, everyone’s giving high fives. But the government’s kind of similar thing like wait, we’re not overnight getting our if they put it into quotations, fair share, right there, people just different, different. And as real estate investors, like this, is the best thing right? Now they’re talking about eliminating or limiting the stepped-up basis. So what does that do to our whole, you know, what we’ve been planning brain and drop into we swap into a job?

Brandon:

I mean, that definitely throws a wrench in that wheel, right? If if, you know, the, where a 1031 exchange can be powerful is where it’s, you know, not every situation. But the situation where a 1031 exchange is powerful, is if someone wants to generate income, consistent reliable income from their real estate asset, and then pass it on to the next generation without having this, you know, big tax gouge. Well, the current administration wants to change that. And it’s going to be fascinating to see what’s going to happen. You know, as I said, and like you’ve referenced mentioned, they’re proposing these bills where they’re going to aggressively tax things. They’re going to remove tax loopholes, what they call them, the 1031 exchange, I don’t consider it a loophole. But that’s the language they use around it. And they’re going to try to eliminate generational transfers. Right. You know, it’s really interesting to see how the world has changed. You know, in the last year, we saw a lot of these smaller businesses kind of really struggling by some of the larger businesses Costco and Walmart, you know, we’re able to benefit from the increased traffic. And so it’s really interesting to see the world may turn from, you know, I think five and 10 years ago, the United States was based around family, generational wealth transfers, small business, those were kind of the things that drove the economy. And if those things are removed, I’m not sure what’s going to continue to drive our economy. And unfortunately, right now, that’s the push is to potentially hamper small businesses and generational wealth transfers.

Brett:

100% It’s upside down, right? It’s big, big government and big corporations coming together and squeezing the middle class to two In trying to try to say that they, they’re really wealthy ones, but we’re going to take away these loopholes that pass generational wealth, that at some point you go, you know, our leadership has failed us, but which is, which is, which is what what I believe. Now I want to move into estate tax, which is the other one that’s kind of the big for the ultra-wealthy, wealthy folks, right, that’s kind of the elephant in the room that the 1031 never, as far as I know ever addressed is always, you know, dropping new swag at the stepped-up basis. But if I was worth 52 million, let’s just say, my wife and I, and all of that inside of our taxable state, we get the stepped-up basis if we were to pass right in our kid or kids would, right. But we get hit with that 40% debt tax. So the challenge is, how do you get outside your tax bill say? And and and still, maintain? and not get hit with the debt tax? Right. So what do you think about that? What is typically the way maybe you found to help clients who have that question?

Brandon:

I’m not as involved in those conversations, you know, where I stay is, you know, I believe that it’s important to be really good at your niche and where you’re at, right? So So when it comes to conversations that are outside real estate or more estate planning, you know, that’s where I like to, bring in someone who, you know, is able to keep up with some of the changing legislation, because that does consistently change. And, you know, that’s, that’s not something where I spend a ton of time. So you know, I focus on the 50 or 60 1031 exchanges that we do a month, and make sure that we do those well, and then bring in experts for the other so all that Yeah, I’m not sure I can answer your question.

Brett:

To the fair enough. That’s good. I was just saying there’s something out there. I mean, we use the deferred sales trust, move it outside of the taxable state, we have a DST plus. And I was wondering if there was any kind of creative 1031 to do it. That being said, You can learn more about Brandon burns it, I tend to do 1x comments I tend to do when I start to calm. Bernie, are you ready for the lightning round?

Brandon:

I’m ready, bring it up.

Brett:

All right, knowing what you know. Now, if you go back to your 25-year-old self, what’s the one Golden Nugget you’d make sure to tell yourself to do?

Brandon:

If I could go back to my 25-year-old self reach back 13 years ago? I mean, I would tell myself to invest more, you know, I look back on my 20s I think I bought into some of the Instagram lifestyles where it, you know, spent a lot of money on trips and frivolous things. I think today the middle class is getting squeezed. You know, we’re our parents were able to build and have a really comfortable life working in a job, you know, maybe not having to invest as much. I think that changed today. You know, we the pandemic, I think moved forward some trends. And one of those trends is really reducing the middle class, right. So if you look at the wage earners, people who only had w two-income, those people got a small stimulus check, they got a 13 $100 stimulus check. And then potentially two, I think 12 $100 stimulus checks, right? If you looked at people who were able to invest, whether that was in the stock market, whether that was in crypto, whether that was in real estate, those people have essentially gotten a small piece of a several trillion dollar stimuli. Right. So so if you look, the investors got trillions of dollars, and the W, two wage earners, you know, had to split, you know, a couple, you know, maybe $100 million, are some much smaller pool. And I think that’s that trend is going to continue. You know, if we look at since a new administration came in office, a stat that I was looking at this morning, was I think gas is up 37%. Coal is up over 50% real estate is up 20 to 30%, depending on where you are. And there was a number of others that were less, you know, I think, I think Brad was maybe 5% and some other things. But the key point is inflation is coming. Right. So the Fed is said, Hey, you know, we’re going to put a blind eye to this, you know, we’re going to, in my opinion, pretend that inflation isn’t coming. I think that it is and so, you know, if we hit you know, if you look at the way that I like to look at it is we’re not when I went to Baylor University in 2003, the tuition was $16,000 a year today, the tuition is $50,000 a year, which is dramatic jump if you look at it that way. But what’s happened is universities have raised their tuition, approximately six to 8% per year, which is not so aggressive until you look back and you see the compounding build-up that over time. If we enter a six to 8% inflation range, which I think is entirely reasonable and probably already happening then you That’s the, you know, the $16,000 that I saved in, in, you know, 2003 today, you know, it’s just the spending power is so much smaller, right? And so I think inflation is coming, and people should invest, you, you, you have to be on the ownership side of the table. You know, when the pandemic happened, I looked back and said, okay, you know, my business was down for about 30 days, as people said, Hey, we’re gonna stop, we’re going to evaluate, we’re going to decide what to do. So I said, Okay, I’ve got some free time. I’m a student of history. I really like history. Let me look back on, on the previous recessions or depressions. And let me see if I can draw some parallels. And you know, I don’t think that what we’re facing today is the same thing we faced in 2008. The financial crisis, I don’t think we’re facing today necessarily is the same as the.com. Bubble. I do think that what we’re facing today is similar to two that happened at the end of the roaring 20s into the depression. And so who were the winners during that time period? There were definitely people that were losers, right? 30% of the population was unemployed, you had hobos riding on trains, going from door to door, just trying to find enough to feed themselves and maybe send some money home to their family. But you also had the Vanderbilts and the Rockefellers that create generational wealth. So, you know, I looked back and said, Okay, what was the difference between the Vanderbilts and the Rockefellers and the people who were traveling on trains? And how do I take that information and apply it to today? And, you know, as I looked at it, the people that were on the ownership side of the table, the Vanderbilts, were in the steel business, right, the Rockefellers from the railroad business. So people that were on the ownership side of the table that was creating goods and services that owned hard assets, disproportionally outperformed. And the people that were wage earners, lost their jobs, became homeless, and traveled on trains, for the most part, right. And so, as I look to my future, you know, I’m in my mid-upper 30s, as I look to my future,

Brandon:

I need to consistently be more and more on the side of the ownership, the ownership side of the table, rather than just the wage earner. Because as we hit inflation, you know, as I’ve looked at many of my peers that graduated with, you know, from college over a decade ago, you know, we’ve seen that the cost of living goes up substantially, not all my peers have had constant, you know, increases in their wages. And so, you know, they struggled in year over year, you know, they said, Hey, I’m doing the right things, I don’t understand why don’t get ahead. And, and those are the people that didn’t invest. So I think, the new environment that we’re in, if you’re able to own something, whether that’s a hard asset, or a business that produces a physical good, that you will do, outstanding, disproportionately Well, if if you don’t invest, you’ll this do, in my opinion, disproportionately poor as we enter more inflationary time period.

 

Tax Reform a CRE & 1031 Game Changer with Brandon Burns

Brett:

Right, and so go and we can almost have it all show on that, which we’re going to go down to our last two questions and that but as amazing answers, I want to keep going there. What’s the number one book you recommend or gifting most in the past year?

Brandon:

The book I’ve gifted the most is, is what’s the base? What it’s called? Something about why and everyone blank. It Starts With Why. So someone told me something a while ago that I’ve never forgotten. They told me that there are no true hard questions. If you’re facing a decision or a question that you find difficult, it’s not because you’re actually facing a difficult question is because you’re asking the wrong question. So if if you ask the right question, the answer is intuitively obvious. So when faced with a challenging situation, instead of struggling with the answer and saying, you know, what do I do here? You should figure out how to ask better questions. So you know, that’s been something that just kind of stuck with me and the people that I know as they face difficult decisions, I’ve given them that book starts with why I say ask better questions.

 

Brett:

Love it. Last question for you. And we’ll wrap up the show after all your success and helping so many people almost making the Baylor basketball team as a random walk-on when everything hit the fan and now Baylor won the champion. That’s a whole nother story for another day. How do you stay centered in your values? Brandon, and how do you stay encouraged charged forward to reach new goals?

Brandon:

Well, that’s a big question. I think the number one thing is, is having a good community. You know, I’ve been fortunate to be able to surround myself with good people. I moved from Dallas to San Diego five years ago, and now I split my time between Texas and California, which are two different places. But five years ago, one of the reasons that I came to California and the main reason was for, you know, a job opportunity. But the secondary reason was I turned around in my community While they were great people, they often weren’t as enterprising. Right? There, they’re more about checking boxes and, you know, maybe maybe not pushing toward goals. And in the past five years, I’ve been fortunate enough to come across people that are pushing toward goals that are pushing to make themselves a better person. And, you know, I think most of us have heard the adage that, you know, you’re the average of the five people closest to you. And I do think that’s true. But being in a good community of people that you know, while not perfect, say, I’m going to focus on my goals, I’m going to focus on my morals, I’m going to focus on self-education. That’s something that’s been really powerful to me,

Brett:

I love it. Brandon, I want to thank you for being on the show. Would you mind our listeners one last time where they can find it?

Brandon:

Absolutely. Our website is i1031x.com you can always reach me at brandon@1031x.com. I’m here, I’m glad to help anyone who has questions. You know, my personal view on the world is, if I wasn’t in this business, I would be a kindergarten teacher. So nothing makes me happier than being able to interact with people as they go through these large decisions about selling property. And being able to add value by a connector, or share information. You know, I’m very good at my small space. I’m not as good outside my space, like, potential some estate planning stuff. But in my space, I have a lot of information. And I focus on being an expert in my space. 

Brett:

Yeah, amazing job. By the way, I think it’d be an amazing kindergarten teacher, and a basketball coach, we should get a team going down in San Diego, maybe you can make a bunch of money move down there, and we can coach the team together. Thank you for being on the show, Brandon. And I want to encourage you to keep using your gift of seeing things before they happen right or more insider trading, and helping people make great decisions and map those things out. I don’t think there’s a better person who can be talking about tax reform right now with the 1031 and what’s going on than us so keep getting the message out. And let’s hope it stays as favorable for the real estate investor and the middle class and those who are creating generational wealth as we can we will pray for that. And thank you so much for being on the show. And I also want to thank our listeners for listening to another episode of the capital gains tax solutions podcast. As always, we believe the highest net worth individuals and those who help them struggle with clarifying their capital gains tax deferral options not having a clear plan is the enemy using a proven tax deferral strategy, such as the deferred sales trust to save your failed 1031 exchange to defer taxes on cryptocurrency a business primary home and or using a 1031 exchange hopefully they’re still around here in full force in another year or so. is the best way for you to grow your wealth in deferred tax please rate review subscribe go to capitalgainstaxsolutions.com YouTube iTunes, go to expertcresecrets.com By the way, if you’re a business professional, and you want to learn how to use the deferred sales trust is in case the 10,000 goes away. So get there now appreciate everybody.

 

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About Brandon Burns

 

Tax Reform a CRE & 1031 Game Changer with Brandon Burns

Brandon Burns is a Senior Vice President at Investors 1031 Exchange with focus on sales and marketing for the company. Brandon is a very experienced commercial real estate executive who has served on the investment committees over several real estate capital firms throughout his career. He has been involved in over one billion dollars of real estate development and acquisitions and has helped acquire 64 projects that have gone full cycle across many asset classes, He has raised over $600M in equity for various real estate projects and was instrumental in successfully issuing $180M of debt on the Tel Aviv Stock. Brandon has undergraduate degrees in real estate, as well as finance; from Baylor University.

 

 

 

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