How to separate taxes with partners

[Ramesh Ramdatt]

Hello everyone, I am looking for help on a question I have. I don't have cash to invest in real estate, but that won't stop me, I plan on finding private money and I already have verbal commitment after only a few days of searching. I know that I have to get final agreement in writing. But I was wondering when I get the private money how do we separate the taxes on any gains we get? So for example my private lender or lenders agree to lend me the money and split any profits 50/50. So to keep things simple let's say they lend me 100k (50k for purchase and 50k for rehab) and the property was sold for 200k so I give them 150k ( their 100k repayment and 50k profit) and I keep 50k. I was thinking of opening an LLC and paying them with a 1099 so that the IRS could see that the only gains I experienced is 50k and not 100k. Can anyone give me some feedback on what the think about this idea, and if there is a better way to approach this problem.