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9 June 2014 | 12 replies
On the Bigger Pockets forums, S-Corp appears to be a popular (but not universal) choice for flipping, as an s-corp would help with avoid profits all being taxed as ordinary income (Federal, State, and then an additional 15.3% for both sides of FICA).In my case, tax rate something as follows:INCOME TAX- Federal (up to 36.9k): 15.0%- CA State (up to 39.3k): 8.0%- FICA - both sides of medicare and social security: 15.3%--------- Total Ordinary Income Tax Rate (Fed+State+FICA): 38.3%- Total Dividend Tax Rate (Fed+State): 23.0%I could be calculating this wrong, but for the flip scenario, I'm estimating the numbers as follows (just updated them to reflect new financing terms and flat-fee MLS): - Purchase Price: $14,000.00- ARV: $60,000.00- COST Rehab: $18,000- COST 5 months of holding costs (flip insurance, debt, utilities): $1,727.50- COST Closing costs (flat-fee MLS and marketing/ 3% buyers realtor fees/ county transfer tax/ 2% closing costs): $3,465.00PRE-TAX PROFIT: $21,707.50Applying the above tax table, the post-tax profits appears to be as follows: - No S-Corp total taxes (100% taxed at 38.3%): $8,313.97- With S-Corp total taxes ($1,500 taxed at 38.3%, remaining taxed at 23%): $5,222.23So, assuming my numbers are correct, with an S-Corp, it's a tax-savings of around $3,000.
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17 June 2014 | 14 replies
The wrong choice can be very expensive, I've been told!
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18 June 2014 | 3 replies
My name is John Heck and I stumbled upon this website while researching a popular mentor program that was highly debated here.
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12 June 2014 | 16 replies
Regarding moving money out of Los Angeles; my first choice would be to stay right here for my next purchase however the more I work with the numbers, the more it makes sense to at least widen my search and become more knowledgeable about cities in which I have family (eyes on the ground).
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16 November 2015 | 30 replies
Thank you for your replies -Had no choice -spent around 3K to fix things up to get the CO that my lender insisted.
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16 June 2014 | 22 replies
It's very easy to rent in that neighborhood. 1BRs go quickly, they're popular with singles, or couples without a lot of stuff.
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11 June 2014 | 5 replies
If you want to buy a 20 unit building in the West Village it's going to cost an arm and a leg because that neighborhood is perennially popular.
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12 June 2014 | 1 reply
I come to you all because I am three weeks away from receiving my bachelors and I am very interested in real estate for the first career of choice out of college.
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13 June 2014 | 13 replies
@Daniel Sanchez welcome to BP and I definitely see the building focus becoming popular as well
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12 June 2014 | 7 replies
If you can find a private lender (someone you personally know, not a HML that calls themselves a private lender), that's a second choice.