Real Estate Investor · Houston, TX · Member since 2014 · 111 posts · 17 votes
My husband and I are closing our first 2 wholesale deals soon. I'm wondering what to do about gov taxes on the income we receive. Do we hire a CPA? Or is it still simple enough that most people can still handle themselves?
Should I just stick back a certain % of each deal for taxes? Maybe do some investing with it during the year to make more money on what I will give to the gov later?
What do you do?
Since we started marketing in January, we have kept receipts of expenses. Anything else we should be doing to help ourselves out come tax time next year?
Anyone have any recommendations as far as tax professionals in the North or East parts of Houston? Maybe someone I can go speak with that can really sit down with me and go over things?
Do you plan on doing more deals in the future? If so, there's no better time than now to start building a relationship with an accountant, especially one that specializes in real estate transactions. Yes, it's a bit pricey. But the long-run savings are more valuable. Not only will the accountant ensure that you file correctly, they also know of the potential write-offs, shields, etc. involved in real estate transactions.
Good job keeping your receipts for expenses, that's important. I don't have any recommendations for people in your area, but I strongly recommend you find someone. The only thing worse than paying an accountant is spending the many hours doing it yourself only to have the IRS come knocking on your door asking for more money or not knowing that there was a tax shelter you weren't aware and therefore didn't take advantage of.
Do you plan on doing more deals in the future? If so, there's no better time than now to start building a relationship with an accountant, especially one that specializes in real estate transactions. Yes, it's a bit pricey. But the long-run savings are more valuable. Not only will the accountant ensure that you file correctly, they also know of the potential write-offs, shields, etc. involved in real estate transactions.
Good job keeping your receipts for expenses, that's important. I don't have any recommendations for people in your area, but I strongly recommend you find someone. The only thing worse than paying an accountant is spending the many hours doing it yourself only to have the IRS come knocking on your door asking for more money or not knowing that there was a tax shelter you weren't aware and therefore didn't take advantage of.
Great job on keeping the receipts you have a business that is active, so you will be making earned income on your profits. If you are going to be successful in this endeavor you will be taxed at ordinary income rates. You will also be subject to self employment taxes if you are doing this in your own name (I am not a CPA or attorney, but just PM me and I have one in North Houston that I can recommend).
I just met with a guy whose office is in the Greenspoint area and I'm going to use them for my 2014 taxes (first time using a CPA). He did a free consult (in person) to look over my prior 2 returns and talk about what I'd been doing in 2014 (bought several buy & holds). I had brought by Quickbooks balance sheet and income statement. He asked about flipping and wholesaling, so I expect he is quite familiar with the side of the business, too. They offer bookkeeping training by the hour, so can probably help you get set up and advise on whether you should have an entity from a tax standpoint.
PM me and I'll pass the company and contact info along.