Just got off the phone with my accountant and have run into a hurdle. He is telling me that since Real Estate Sales & General Contracting are in separate industries, claiming 2 un-related SIC codes will increase my odds of an audit. Currently I am a real estate agent and run my business through an S-Corp. I also want to be able to act as a general contractor and use my current S-Corp for this purpose as well. I could just setup another LLC to run the GC business, but I would prefer to keep them all under one business. This would also help me when applying for loans as my income can fluctuate between real estate sales and building depending on what I am focused on. Has anyone else run into this problem of trying to perform business activities in 2 different industries? What was your solution?
Can't you just put you primary SIC on your taxes? Whichever business makes the higher percent of your income. Why do you need to put two?
IRS does not want Loss form different business activity to offset income from another one. The Scorp has to show the break down of the income by activity anyway. Also, from the liability perspective, you would wanna keep them under different entities.
There could be some entity structuring done to keep the income under one business.
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