The money you make is tax-free if it's your primary 2 out of the last 5 years (if you rent it for a while, I believe there are some taxes, but it's prorated on time based on what I remember - not tax advice).

You give the vendor the completed 1099 and you report it also to the IRS in your tax filing.

This approach would not yield significant immediate cash flow but could lead to equity growth, tax deductions, and property appreciation over time.

If you qualify, it is a nice option.In the IRA format, you need to start with an IRA held by a non-traditional custodian, then have the IRA make a single investment into either an LLC or Trust to obtain checkbook control over the IRA.There are a few firms that specialize in establishing a checkbook IRA trust.If you are investing in non-liability risk assets like funds and syndications, there is a clear advantage to the trust as it is not considered a business and therefore not under the purview of the CA Franchise Tax Board.If you will be investing in rental property, the limited liability protections offered by a LLC may outweigh the cost and headache of California filings. 

I figure the single-family strategy will have more advantageous tax benefits to flipping, and I can flip it more quickly, possibly in just a year and a half.

He is also wondering if the taxes would be less if he just sells the property outright.

Tax compliance: Keeping good records of your income and expenses will make it much easier to file your taxes accurately.

Join FB groups for your markets and get on the list of your local wholesalers.Get your finances together so that you know where your tax records are and how much you have for a downpayment and what your credit score is.

You should be able to get a FNMA loan on the 4-unit, based upon 2 years of tax returns - but ownership will have to be in your personal name.Many banks will also lend on the 6 & 10 units with 2-3 years of tax returns showing they are profitable.

We have a small fee for registering and the city (247 people) implemented a 1% tax in order to do some improvements.