Posted by Terry (Houston) on July 09, 2002 at 18:35:26:
If you take possesion of a house in your corp, but you have to sell it on a lease option, how would that be taxed? Dealer, sale, what?
Is that not good to have rental income in your corp?
If you plan to flip them and they do not sell and your hands are tied what can you do?
Thnaks in advance,
Terry (Houston)
Just a matter of time…Dealer status? - Posted by Luke
Posted by Luke on July 08, 2002 at 11:05:36:
Hi, I want to start in the next month buying, fixing then reselling houses - about 6-8 a year. Is it true that I will be labeled a “dealer” by the IRS and that I better just prepare for the fact that my “S” corporation will be seen as a “dealer”?
Is there ANY way to avoid the “dealer” status, or is it better just to accept the fact that I am going to be marked as a “dealer”
Thanks for any input.
Re: Just a matter of time…Dealer status? - Posted by JHyre in Ohio
Posted by JHyre in Ohio on July 09, 2002 at 08:04:54:
Some tax advisors say “never treat your properties as dealer property”…just wait for the audit, if any. I disagree- I operate under the quaint notion that the law should be followed…interpreted aggressively, but followed if no reasonable interpretation can be found around it. If all that you do is rehab and sell homes, you (or your entity) are a “dealer” for IRS purposes…I would plan on paying taxes as such. There’s more leeway if rentals or lease-options are involved, but pure resales are dealer transactions in my view. Bummer.
John Hyre