If someone originally loaned you $5K and then received $6K when you flipped the property, issuing a 1099 for $6K could cause them to pay taxes on the full amount, rather than just the $1K profit they earned.A cleaner way to structure this might be to have them buy into the partnership instead.

Partnerships can also be powerful if you align with people who bring complementary strengths, like capital, construction expertise, or deal sourcing.In my case, I started with buy-and-hold rentals, but now our co-investing club pools capital to partner on larger projects together.

If a lender isn’t local, what are the best ways to vet them to make sure they’re reliable and a good fit for long-term partnership?

The tricky part would be the partnership itself.Another alternative would to see if the seller would be willing to provide you financing. 

Once she is formally included in the partnership, she should be designated as a general partner.

What is common: buying a percentage of the whole parkThis is done all the time.Example:If the park is worth $5M and you buy 20 percent, you now own 20 percent of the entire business and all 100 pads, not specific pads.This is done through:A membership interest purchase (LLC)Partnership agreementOperating agreementYou become a co-owner, not the owner of specific lots.3.

I invest in the Midwest and see a lot of investors tap equity through partnerships or local credit unions that are more flexible than big banks.

.), then you would split the profit 50/50 as a partnership.Your partner would buy the property in an entity he controls 100%, and there would be a partnership agreement between you and that entity.

To lower audit potential a partnership LLC is 1 tenth the likelihood of IRS audit but you need a partner.

Quote from @Garry Lawrence: I would talk with an attorney for this type of partnership.