All Forum Posts by: Paul Brouwers

Thanks @Bradley Sriro!  That's exactly what I'm looking to do depending on how my year at work shakes out and what effective tax bracket I land in.

This is a bit long winded, stick with me.

My wife and I have live in flipped 2 houses, doing most the work ourselves over the past 10 years.  Takes forever, lots of learning, have made great money.  2 years ago we bought one of the ugliest houses in the hottest area of our city with the intention to do the same, but probably have someone else do the work just for speed and because we plan to live here for a while vs just flip and move on.  Talking to a few builders, it's clear moving out for 3-6 months or so will probably make it easier on everyone.  This is where it gets interesting.

My neighbor just put their house up for sale and it ALSO needs work, but not as much.  This has been a rental for 10 years getting $1600/mo (they've owned it 40 years). The house is up for $365,000.  It needs a complete kitchen gut, new baths and maybe some other work, have a showing scheduled to see what's going on.  Comps in the area for similar sized homes that have been flipped on the cheap are in the $550,000 range.  It seems like after costs for downpayment, reno, realty/closing I could walk with around $85k before taxes, and that's where it gets interesting

My question is this, which I'll also pose to my CPA next week.  Is there a tax benefit to purchasing my neighbors and marking it as our primary residence and moving in?  Have our house renovated over 6 months.  Then move back in here, have the neighbors house renovated and then sell it a year from now?