Just Flipped my first property!

[Tara Grogan]

I am closing this week on a property I bought a year ago for 50k started renovations well more my manual labor, but anyway I sold it for 103k.  I was wondering how do I figure out what to send uncle sam for taxes.  And my next question is how much taxes would I have owed if I sold it before I had owned it for a year!  I only sold it because I want to finish renovating  a bigger house that I have.  I have started reading book on hard money lending, and mortgages before this I did and still do interior design and faux finishing for the past 10 years.  Any help on taxes mortgages a better way to fund this than my own money that is safe Im all ears.

[Bill Exeter]

Originally posted by @Tara Grogan:

What is a 1031?

A 1031 Exchange is a tax-deferred exchange of real estate.  It gets its name after Section 1031 of the Internal Revenue Code, and allows an investor that has held a property for rental or investment (not flipping/rehabs) to sell the property and defer the payment of their taxable gain by reinvesting into one or more rental/investment properties (replacement properties).  It means that you do not have to pay any of your depreciation recapture and/or capital gain taxes as long as you follow the guidelines so that you get to keep the money in your own pocket working for you and building your wealth instead of paying taxes.