Using Fix and Flips to Offset BRRRR Losses

[Amit Chawla]

So I started a investment company for real estate. The strategy of the company is to mainly do BRRRR deals. Along the way I have come across a lot of deals that would be great fix and flips but was wondering how the income would work when it comes to taxes. The idea is that the BRRRR properties would generate a paper loss yearly (with depreciation, etc.), would I be able to use the "loss" to offset any profit I make from a fix and flip in the same year?

Example:

Purchased 12 unit apt building.  After renovation and cash-out refi and cost segregation study, will show a significant loss (est. 150-200k loss), can I do a fix and flip that makes roughly 100k in profit.  If so would I have to pay taxes on the 100k profit considering I show a loss from the buy and hold property?

Just looking for clarification.  I am planning on meeting with my CPA soon.