hey all…i hear everyone talking about making a certain amount on a wholesaling deal. 5k, 7k etc. but what percentage of one’s wholesaling fee goes to taxes?
If I were you, I would talk with a CPA, or your tax person (professional) about this, on every successful deal that closes. Each situation is different, and which will require a different amount. I can’t remember the name off the top of my head, but I think you can ask the title company for one and they can give it to you. It’s better to be safe, than to be sorry. Maybe you can open an IRA and use it for your taxes?
there are no taxes per se on a wholesale deal. taxes are based on total income for the year and are affected by a number of items, including other income, expenses, your personal tax rate, etc.
worrying about taxes until you make the money wholesaling is like worrying about it prior to playing the lottery.
lol gotcha…just curious. thanks for both of the responses
I believe that’s a 1099-S you get from the title company correct me if I’m wrong.
doesn’t matter how much money goes towards the taxes if you are making a profit? Correct me if I’m wrong here, if you have to deal it looks like a potential $7000, if you only get paid $5000 after taxes would you be okay with that? You’re darn straight you will! :beer :bobble
Take out half of that money put it towards some more effective marketing, get 10 more deals like that. Just make sure you reinvest some of that money.
thanks for all the responses…though i really didnt get an answer to my question, regardless of whether i see a check or not, id still like to know…i’ve gotten check with cpas and ask this person…but for the people who have actually done a real estate deal - do u just wait until the end of the year to pay taxes on all of ur deals as hassaner has suggested, or is there more?
Most people I know wait till the end of the year. Don’t forget about the wonderful tax write-offs for owning a corporation. (llc or inc) You get that lined up yet?