Tax Write Offs On a Flip

[Andy Hughes]

For those of you in the flipping business.  Can I pay myself for work done on a flip?  I am looking for tax write offs to help reduce capital gains for profits made on a flip purchased in late 2016- and sold in early 2017.  Thanks for any assistance!

[Doug W.]

Your flip profit will be taxed as ordinary income. The IRS would consider you a Real Estate Dealer. You will need to pay self-employment tax as well. 

Talk to a CPA who understands flipping to learn more. Check out @Brandon Hall's podcasts and blog articles here on BiggerPockets and you will learn a lot about this exact subject. 

That being said... you can deduct mileage (understand the rules, first), items like clothing and tools (if used for work that you did on the flip), and a home office.