Legal questions regarding raising funds and taxes

[Charles Mitchell]

Another post where I've turned to the wisdom of BP!

A family member an I are going to be doing some fix and flips. We have our terms worked out verbally but nothing on paper just yet. I have some questions regarding taxes as well as raising funds.

1) We will be splitting the cost of acquisition and rehab 20-80. I'll be contributing 20%. I have an LLC and am curious if my family member transfers the funds to the LLC, will it be subject to taxes? Should we write out some sort of open-ended loan agreement?

2) How will these flips be taxed? Were looking to do 25 in the next year. I've done some research and found that you can be classified as a "dealer", meaning it gets taxed as normal income. Is there a way to declare myself a dealer or does the IRS make that decision?

Thank you in advanced BP!