Posted by Dennie on April 29, 2004 at 15:41:03:
I suspect that the reason that no one has answered your question is that there is no easy answer. The research that I have done suggests that your intent determines whether you are a dealer. If you are a dealer, then you are not an investor. If you buy with the intention of immediately selling then you are a dealer. If you buy with the intention of holding, then you are an investor. The problem is that if you are doing dealer deals and investor deals in the same entity, then the IRS might classify all your deals as dealer deals with some rather significant tax impacts. I have spent a lot of time researching this and a lot on legal advice in this area. The best information I have found comes from George Yeiter who is a CPA who specialzes in real estate. I bought his material from Bob Meitzer at Realbooks.com, but I think he also has a web site. I am not a lawyer.