Wholesale and Taxes in NC

[Kyle Falkenstein]

For everyone that is or has wholesaled in North Carolina...I plan on getting in contact with a CPA and attorney. I was curious on people’s experience. How much taxes are taken out of your assignment fee checks? Also are the taxes taken out at the title company before receiving my check or would I just need to set money aside for taxes?

[Michael Plaks]

@Kyle Falkenstein

I second the recommendation of @Natalie Kolodij.

You do not pay taxes on each assignment fee. You add them all up for the year, you subtract all your business expenses, such as marketing, driving, education etc - and you arrive to your annual NET business income (or, often in the beginning, loss).

You will add this business net income to your other income, including military pay, and the result is taxed. In addition, the business income pays an extra 15% "self-employment" tax. All of that is due next April 15.

Once your business gets going, you may want to pre-pay some of the business tax via quarterly estimated payments - a tricky subject to discuss with your future accountant.