What is the best way to minimize capital gains taxes when you buy and sell a house for profit within a 90 day period or less??? Thanks.
By properly documenting every single penny that you spent on the capital improvements.
By and large, it is pretty cut-and-dry…you owe, you pay.
Thanks Keith for the response…
Is rehabbing for a quick sale your business strategy, or is this a one-time thing?
I only ask because you asked another question about the tax treatment of an option.
I am more interested in flipping properties. If i buy a home at an “undervalued” price and turn around and sell for more money is there any way around the capital gains tax??? Would i pay a capital gains tax??? Thanks.
No, you don’t pay a capital gains tax.
Instead, your activity is an active income business. As such your profits are taxed as self-employment income at your ordinary income tax rate. Your profits are reported on your tax return using Schedule C and Schedule SE.
Thanks for clearing that up.