Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
8y
The net income is ordinary income. Net income is not the amount you receive when you close deals. That's your gross income. From that you subtract all your costs associated with running your wholesaling business. The net income is subject to federal and state taxes at your ordinary, marginal rate. This income is also subject to self employment tax (SET). That's both halves of medicare and social security, so 15.3% in total.
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
8y
The net income is ordinary income. Net income is not the amount you receive when you close deals. That's your gross income. From that you subtract all your costs associated with running your wholesaling business. The net income is subject to federal and state taxes at your ordinary, marginal rate. This income is also subject to self employment tax (SET). That's both halves of medicare and social security, so 15.3% in total.
Investor · Pittsburgh, PA · Member since 2015 · 1k+ posts · 1k+ votes
8y
@Hunter Ambos if you dont need the income then you may be able to put some of this money in a self directed IRA and pay no tax or tax deferred. Seek expert advice for this