Posted by Bill on January 17, 2003 at 20:12:53:
Great advice Peter. Also, Joe, shop for a CPA to find one who is well experienced in dealing with real estate investors.
Simple tax and w/s flip question - Posted by Zoe K.
Posted by Zoe K. on January 17, 2003 at 09:16:44:
Hi All,
Pretty simple question: I did one wholesale flip in December. I have not incorporated yet. For filing my taxes, I am stumped as to what type of income an ‘assignment fee’ would be. Is it simply ‘self employment income’ or is it classified as something else?
Also, I have a bunch of expenses to write off in regards to starting my r.e. business, would I just write these off using the ‘itemized deductions’ forms?
I hope someone knows the answer to this question, because I really don’t want to have to go to a tax preparer just for this…any help is greatly appreciated.
I posted this on the legal board as well…
Zoe K.
Re: Simple tax and w/s flip question - Posted by Peter_MD
Posted by Peter_MD on January 17, 2003 at 11:46:21:
Zoe K.:
I figure you can’t afford not to get professional advice and counsel…just like you will eventually need a good Attorney when you start doing more deals. Anyway, being foolish for not spending money on advice you evidently need, is not good business sense and you are headed toward disaster, in my opinion (of the worst kind). You don’t want to have to deal with the IRS, if you can avoid it.
Go to an accountant (preferrably a CPA) to do your taxes and advise you on financial matters relating to real estate investing…you need one about a month ago.
The money you pay them is deducted against any income earned and received…and it helps you in that you can sleep better at night.
BTW, no, you don’t deduct ordinary, necessary, and reasonable business expenses on your Form 1040, Schedule A (Itemized Deductions).
Good luck to you…and good for you by getting the income from a deal…go out and do more, and leave the driving (oops) taxes, accounting, and finances to a professional CPA.
Just the way I see this…