Investing in the market I Build

[Kevin Kittilsen]

I work for a custom design build firm. Many of our custom home projects are in a central down town area where we are demolishing existing older homes and building new homes on lots. I have purchased several properties under their own LLCs. However, my accountant has told me that when I sell the property(s) to a client to build a home on, any gain on the property itself will be taxed as ordinary income. Say I buy a property for $450k and then sell the property for $515k to a client and then subsequently build them a home on the lot, my accountant says that $65k would be taxed as ordinary income. Looking for advice here.