Posted by ken in sc on February 26, 2003 at 12:19:06:
Hopefully John Hyre will see this and give you good advice. But the short answer is yes, you made $46K so you pay taxes on $46K. Now there are a lot of things one can do to lower taxes but it will depend on the entity owning the houses and how it is set up. If you don’t get a good response on this question, try it agin as a tax question and give specifics especially who owns the property.
Congratulations on your success! It is difficult to avoid all taxes when you are doing well!
Guidance with money - Posted by David W
Posted by David W on February 26, 2003 at 12:07:32:
Here is the situation. He have a closing for April 28th. We will net $27K at close. We have another house that we are offering on at $143K, needs less than $5K in work and can resell for at about $165K (my own market analysis and an analysis from a realtor). But for arguements sake, let’s say I sell at $162K. Here is my question. We will have to report an additional income of $46K ($27K profit from first home, $19K profit from second home). Is this correct? Am I now assuming an extra $46K in reportable income to the IRS? If so, how can I lessen that tax burden from the $46K?