Skip to content
×
Pro Members Get
Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
ANNUAL Save 54%
$32.50 /mo
$390 billed annualy
MONTHLY
$69 /mo
billed monthly
7 day free trial. Cancel anytime
×
Take Your Forum Experience
to the Next Level
Create a free account and join over 3 million investors sharing
their journeys and helping each other succeed.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
Already a member?  Login here
Tax, SDIRAs & Cost Segregation
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated over 6 years ago on . Most recent reply presented by

User Stats

19
Posts
7
Votes
Alex Natanson
  • Hudson VAlley
7
Votes |
19
Posts

Capitalizing flip expenses

Alex Natanson
  • Hudson VAlley
Posted

I'am relatively new to USA flipping business but have a strong experience in other countries with a different kind of accounting/tax systems . I have looked through the search but have not found something corresponding to my case.

For now i don't have W-2 or any other income. 2020 will be the first year i 'am doing my return for 2019. I'am closing on a flip in couple weeks in my personal name. I will have direct and indirect expenses with the house. As i get it the direct expenses (purchase, taxes, insurance, reno costs, etc) are go attached to a flip and deducted while sale takes place id est capitalized with the house. My issue is with indirect costs (mileage, mobile, office etc) in this 2 months to come. Can they be attributed to the house expenses and be deducted in 2019 or they should be wrote off in 2018? The logic and my other experience says yes you can capitalized them as well. But reading IRS publications doesn't shed light so logic and IRS not always come together. 

Please share the actual experience (advice to get a CPA can be omitted)

Most Popular Reply

User Stats

23,418
Posts
13,509
Votes
Wayne Brooks#1 Foreclosures Contributor
  • Real Estate Professional
  • West Palm Beach, FL
13,509
Votes |
23,418
Posts
Wayne Brooks#1 Foreclosures Contributor
  • Real Estate Professional
  • West Palm Beach, FL
Replied

Those definitely get deducted in the year they occur.

Loading replies...