Just google up irs section 121 and you can read the exceptions.If you sell in less than 1 year.....short terms cap gains, ordinary income tax ratesAfter 1 year, long term cap rates, likely 15-20% (the amount of the gain is added to your ordinary income for the purpose of determining which cap gains tax rate you pay.Your gain is the “profit”...after commissions, closing costs, capital improvements you made less what you paid for it.

The down fall is that when ever you pull money out of the C-corp it will be taxed at your ordinary individual tax rate, whether it is salary or dividends.

It will be taxed as ordinary income at your rate and may even increase your tax bracket.It will be taxed at the state level from anywhere from 4.00% to 8.82%.

That tax rate is your ordinary rate, but its currently capped at 25%.

All ordinary income reported on page one of the 1065 and subject to SE tax.

The corporation pays taxes on its income and then you pay taxes (capital gains or ordinary) on the distributions you receive from the C Corp.

Jeff S Na If your investment strategy is to buy and sell for profit, it does not matter how long you hold the properties before sale -- the sale profit will always be ordinary income (subject to self-employment income taxes).

@Kyle Doney Yes you are correct it depends on the municipality, but generally speaking any time you open up the walls to do anything you need a permit.Here is a list of what we have needed to pull permits for on past projects:Electrical, plumbing, moving/removing walls, new roof, decks, patios, new furnace, hot water heaters, install fence, new driveway, new siding, new windows, retaining walls.If your not opening up the walls and just replacing the finishes in the house generally you will not need a permit.

One thing that worries me though is the fact that we will be paying 'ordinary income' if we sell before we reach the 12 month period for Long Term cap gains...Have any of you had to deal with this before?

Most long term parks require tenants to fully skirt their RV and most tenants who really are staying long term will build an addition, deck or patio, install a storage shed, create a garden, and show other evidence that they have made this their permanent home.