Offsetting profits from a property flip
Greetings,
I purchased a home in Feb that I was intending to renovate and add to my existing buy and hold portfolio. The renovation is near completion, and I was approached by someone that was interested in buying. The proceeds of the sale would give me a net profit of approximately 30K and I am considering going forward with the sale. I have two questions related to the potential tax implications of this sale.
1- Since my intent was to rent the property at the time of purchase, would that change the tax rate I would be responsible for? capital gains vs. self employment/regular income
2- Would the income of the sale of the flip be looked at holistically along with the expenses of my other rental properties? In other words, if I opted to make large scale improvements to my other properties (new roof, kitchen, bathrooms, ect) would these expenses help offset the profits of the flip?
Thanks for your input.