Actually, the IRS does not characterize anyone as a dealer, but instead looks at each transaction to determine whether the taxpayer ACTED as a dealer to real estate for that transaction.In a nutshell, property you acquire with the intent to resell is dealer realty and you are acting as a dealer to real estate for that transaction.Draw your own inference from the IRS definition of a "dealer disposition" in Section 453 of the Internal Revenue Code which defines a dealer disposition as ANY disposition of real property held primarily for sale to customers.So to answer your question, the word ANY in this definition tells me that the magic number is ONE.If you are flipping you are a dealer.

There are other disposition strategies with a NPN.

So when filling out the disposition of assets form do I say that I sold them for $0 (basically threw them in for nothing)?

Code § 1701j–3 - Preemption of due-on-sale prohibitionshttp://www.law.cornell.edu/uscode/text/12/1701j-3 "(d) Exemption of specified transfers or dispositions With respect to a real property loan secured by a lien on residential real property containing less than five dwelling units, including a lien on the stock allocated to a dwelling unit in a cooperative housing corporation, or on a residential manufactured home, a lender may not exercise its option pursuant to a due-on-sale clause upon—.............(4) the granting of a leasehold interest of three years or less not containing an option to purchase;.....````````````````````````````````````````````````````````````````````````2) the IRS Here’s what the IRS looks for in determining whether there has been a disguised installment sale: (1) Whether the amount of the purchase price and right to the purchase price is fixed and unqualified; (2) Whether the obligation to convey title on final payment of the purchase price is absolute;(3) Whether the vendee/optionee has taken possession or has the legal right to possession; (4) Whether the vendee/optionee has otherwise assumed the benefits and burdens of ownership.

It is a dealer disposition issue.

This means that all of your accumulated gains and losses are netted together and taxes upon the final sale/disposition. 

Here’s the scoop…I have a CPA, but he didn't provide me the answer I wanted and/or think is logical when it comes to the topic of claiming "Partial Disposition", so I wanted to put it out to y'all.  

We got the property rented for April 1, 2022 and sent her the security deposit disposition which showed she had a balance after covering the one month rent, one month to re-lease the property and an amount related to damages that occurred due to tenants neglect.We received a letter back a few days later from the Connecticut Fair Housing Center, informing us that we needed to return the entire security deposit back to the tenant.

Investment Info:
Large multi-family (5+ units) buy & hold investment in Mesa.

Purchase price: $13,000,000

Sale price: $18,200,000

DISTRICT FLATS
112 UNITS
Mesa, AZ​
​ ACTUAL PROJECT LE...

What if the intent all along is the highest and best use or disposition?