All Forum Posts by: Jessica S.

I suggest also putting your question up on the Boglehead forum and then comparing those answers to the ones you get here. If you're not familiar with Bogleheads, they're people who primarily advocate a conservative form of passive investing.

Plans, such as the one you're contemplating, always seems so great when the market (whether it's stocks or real estate) is working in your favor. The tough thing is figuring out what to do when everything starts to go south, as it inevitably will..

My own cash. I don't like debt, makes me nervous.

I spent most of December trying to find our next flip project. After lots of frustration I got a call from my agent on Christmas Eve that I had two accepted offers to pick from. We decided to buy both houses and bring some friends on as equal partners. House #1 closed yesterday and house #2 will close next Monday. We're excited to get to work.

@Adam Hofman, I grew up in Berkeley, and now own the house I grew up in. Pretty tough market...

I just sent an email to your gmail address.

We have the same law in OR. Getting a license is fairly easy and not that expensive. If you are doing a lot of DIY you will get better pricing on some of your supplies which is an added incentive. I wouldn't enter into a financial partnership with a GC simply to fulfill this requirement.

This sounds like a great plan. I hope we generate enough income to take advantage of its benefits.

Thank you @Dave Toelkes for your in depth reply, it's much appreciated.

I was under the impression that proceeds from flipping one or two houses a year could be construed as investment income rather than self-employment income. From the answers given above it seems that may be a mistaken assumption.

Although I do like to save money, I prefer to follow the rules, particularly regarding taxes. Thanks for showing me the way

One more question: I've read that partnerships can be a problem because of double taxation. Is this true, and, if so, what steps can be taken to prevent this?

We replaced one in a rental, primarily because the floor grate that sat above it got so hot. We thought it could be hazardous for little kids.

I'm planning to partner with a friend on two flips in 2014. We will each be contributing equal amounts of money to the projects. Since I only anticipate doing two flips next year I'd prefer to declare the profits as investment income on my tax return rather than business income. Would the partnership preclude me from doing this? Can we just divide the sale prices and cost basis' in two for our respective tax returns?

If that isn't possible, what are our alternatives?

These will be cash purchases so it would be possible to form an LLC instead of a partnership. Would that be advantageous from a tax standpoint?

Thanks for your help

This is very helpful, thanks so much! And thanks for the good wishes : )