General Contractors filling out 1099 Forms/ working on the books

[Lauryn Meadows]

My husband and I purchased our first flip house from the bank in January. We had a contractor in place that walked the property with us before we purchased. Once we were ready to start on rehab I asked the contractor to fill out a 1099 and a contract and they flipped out at the thought. Long story short, we didn't go with that contractor and my husband started doing some of the work himself. We've asked subcontractors to do the same thing (1099/ Contract) and many of them have also rejected the idea of filling out the 1099 to claim the money we paid them on taxes. For this project, we are going to finish out most of the work ourselves in order to stay in budget. However, we really need a GC in order to continue doing these projects. (My husband and I both work full time jobs plus we are expecting our second child- 2 under 2!) How have you all handled contractors wanting to work under the table? In my mind, I'm thinking that my purchase price is $3,500, and my sell price is close to  comps ($60,000)..(This is a total gut/ remodel on this property..all in budget of $40,000)  I have to show where all of my expenses are on this property in order to mitigate our own tax burden. Any advice on handling this situation is greatly appreciated!