Posted by Houserookie on July 11, 2002 at 14:55:34:
My appology for any misunderstanding, the statement was a response to your comment, “Im not an expert on this subject but I do not like paying taxes!”
Fair enough I’ll take that as meaning “capital gains.”
Yes, I agree…40% is too much.
Austin
FLIPPING HOUSE = CAPITAL GAINS?? HELP! - Posted by n00b (Southern CA)
Posted by n00b (Southern CA) on July 11, 2002 at 03:43:27:
if i bought a house for $200k and sold it for $300k, what could i do to avoid a capital gains hit on the $100k profit? by the way, i don’t plan to live in the house, either. could i set-up an llc and then have the property put into a land trust with the llc as the legal owner before selling it? or, what else could i do? please help. thank you, kindly.
Re: FLIPPING HOUSE = CAPITAL GAINS?? HELP! - Posted by Dave T
Posted by Dave T on July 11, 2002 at 16:22:13:
Under the scenario you describe, all of your profit will be taxable as ordinary income in the year of sale. The use of a business entity or trust as a title holding device does not shield the sale profit from taxation.
Re: FLIPPING HOUSE = CAPITAL GAINS?? HELP! - Posted by Robert (NC)
Posted by Robert (NC) on July 11, 2002 at 07:17:26:
while hard to avoid paying tax’s on 100K profit, there are several ways to reduce the amount. You could use a 1031 exchange to delay paying the tax’s, assuming you can quickly find another property that you want.
I’m sure some of the experts on here can give you better advise on lowering or delaying paying taxs on it…
Happy investing… Hope I can find a property to ake 100k profit on… 
Robert
taxation - Posted by ken in sc
Posted by ken in sc on July 11, 2002 at 07:00:01:
Let me start by saying that I am no accountant. But this is an easy one if you bought and sold quickly for the purpose of profit and never lived there or rented. You will not pay capital gains - thos are paid on long term holdings. You will be taxed on your profit at your tax rate on the year you sell. Land trust makes no difference when compared to personal. It is very difficult to avoid paying taxes on an obvious $100K profit such as this.
Ken
Re: taxation - Posted by michaela
Posted by michaela on July 11, 2002 at 07:13:04:
hm, i thought i’m paying for ‘short-term capital gain’ on a house owned less than 1 year and "long-term capital gain’ on investments owned longer than 12 months.
Re: taxation - Posted by ChrisTX
Posted by ChrisTX on July 11, 2002 at 11:40:02:
Create an IRA to buy and sell the property. Let the profits remain in the IRA that you control to let massive amounts of monies build up tax free! If you did it in an educational Ira, you probably could make a loan to one of your family members to get the money out. Only you need to get creative about this. More info could prob be gotten from mid ohio securities. (find there banner somewhere on the site) Im not an expert on this subject but I do not like paying taxes!
ChrisTX
Re: taxation or NOT - Posted by Houserookie
Posted by Houserookie on July 11, 2002 at 12:23:52:
There’s nothing wrong with paying taxes. Just pay your share…but no more. If you don’t want to pay taxes, don’t live in this country. It’s the price we paid to live in a great country.
With that said, yes, your IRA idea works well. Altho I would look more into the legality involving loans to immediate family members.
A strategy that might work better is to put money into a self-direct ROTH ( future profit tax free) and use funds in there to purchase options, enter contracts, or buy and sell.
INstead of flipping properties, get paid to cancel the option and let the seller deal directly with buyer.
Keep the option release fee as profit in the IRA tax free. Say the option fee is $1 and you profit $5,000…that’s good money.
Austin
Re: taxation or NOT - Posted by n00b (Southern CA)
Posted by n00b (Southern CA) on July 11, 2002 at 14:11:44:
with all do respect, i never said that i didn’t want to pay taxes. i just said i didn’t want to pay “capital gains” taxes. i don’t want to get into a big debate about this. i just believe you missed my point. although you and i, as well as the many people on this site, are patriotic american citizens, i would think it would be fair to assume that most of us agree that paying a whopping ~40% capital gains tax isn’t exactly the best way to exibit that patriotism. perhaps, in the eyes of the irs.