Do you find that branching into alternatives, outside of REITs, is worth it for your typical investor in terms of the added complexity of finding the right investments, the knowledge you have to have, and also the tax implications of those kinds of investments?
Obviously one of those newer alternatives is gonna be crypto. So a lot of people are in that space as well. I don't think it's a core focus of any of our clients. It goes back to that other point that we had talked about before, of how do you diversify? So I think, yeah, having a real estate investment trust, a small piece in crypto will, in the long run, serve you better. Just like our parents' generation, when they were investing in gold and silver, right? That was their diversification strategy. I think with us, and with this new generation, it's gonna be that crypto will be that space of diversification.
So I think the crypto, if it's a piece [of your portfolio] is worth it. I guess I'll speak more from the tax perspective. There's not a ton of guidance right now on crypto, so we're letting our clients know, you're gonna be treating it just like a stock or bond, as just a capital gain on your tax return. The IRS is gonna be looking for that question to be answered on the tax return on whether or not you hold cryptocurrency or not. If the answer is yes, but they don't see any types of sales, it could potentially raise a red flag. So you just wanna make sure you're reporting the gains that you are earning.
Then from a real estate trust investment piece, with either traded or non-traded, we definitely see the value in it. Because of the way the depreciation works and the tax laws are set up, you're able to take advantage of not needing to pay income tax on the full dividend that you might be receiving as well. And that's the same thing with when you manage your own real estate, it's considered passive income. So ultimately, yes. I think that even though there are extra complexities, the return or the value that you get [with these alternatives] is worth it.