Posted by Brent_IL on February 07, 2002 at 18:34:00:
The profit from straight flips is short-term capital gains and is lumped in with the rest of your income when you file your tax return. If you are successful, it will be quarterly. You need to retain some of the cash to pay your taxes.
I’m brand new to all of this and am picking things up slowly. I’m going to purchase my first course soon…I think the one by Steve Cook on flipping (in case you have recommendations.)
Anyway…here is one question that has stuck with me so far as I read this board. Say you flip a house and make $4,000 on the deal. I don’t know how any of it is done yet, but that’s not my question. That’s why I’m getting the course.
What I want to know is when/how do I pay tax on that income? Do you just set aside a percentage of it and pay when April comes around?
I apologize if this is a stupid question. Taxes aren’t my best strength either.