Tax's: negative income made on flips

[Nicole Graziano]

I flipped 2 houses w a partner. 1st house was a loss of about 60k ea! (120k total)

2nd house we are making a profit of 120k but this "profit" would literally pay us back for our initial investments into our LLC together we used on the first house ...

anyone have any idea how the gov. Is going to look at this ? Will I still be taxed on that 120k even though it just returning our initial investment $$..??? 

[Basit Siddiqi]

There will likely be a partnership return required where you flipped a house with a partner and lost $120,000.

If you sold the other property within the same partnership, it will also be reported on that partnership return.

The net result to you is that you will receive a K-1 showing your income / loss which you then use to report on your individual return.

If you made no money within the same year, you likely pay no additional taxes / get no additional refund.

Best of luck.