You aren't taxed AT ALL on the gain of a house sale if you are doing a series of 1031 exchanges. 1031's rock!OGRipper said:
My first flip...
- Thread starter Crashby
- Start date
Heidi said:
Doesn't that only apply if it is capital gains from the sale of your primary residence?
Nope, that's the beauty of a 1031 exchange. You just have to closely follow the rules. It's easy to lookup - the IRS code section is 1031.N8 said:
The sale of your primary residence after 2 years is 100% exempt from taxes REGARDLESS of what you do with the proceeds...N8 said:
biggest personal tax benefit in our country...
Well, that's almost true. There is a maximum amount that is exempt - $500k for a married couple. It usually doesn't matter, but then you have places where almost everyone has at least that much equity in their house.Crashby said:
Up to a $250K limit ($500K for married filing jointly). Not that anybody is hitting those limits in Rochesta.Crashby said:
Anyway, if you gotta keep reinvesting in like-exchanges, how are you ever gonna buy a Porsche with the proceeds? And if you can't buy a Porsche with the proceeds, what's the point, anyway? Can you convert a 1031 to a primary residence without incurring a tax penalty?
Still seems like a hard way to make $6k to me.... I'd have to flip 7 houses to make what I do on an average new spec home.
Let's be clear: You ARE taxed, but you are allowed to defer the tax until the next time you sell and (for whatever reason) don't do another exchange. If you keep exchanging you will never pay the tax.Heidi said:
N8, like I said earlier I'm not sure if it applies to ordinary income or just cap gains, it would be easy to check - see 1031. It's only limited to your primary residence if you are selling a primary residence - if you are selling an investment property, you can exchange it for another investment property. It works for "like kind" exchanges, so you can't sell a residence and exchange for investment property.
It's smart to keep your company a LLC. Definitely protects your personal belongings in the event of a major lawsuit.N8 said:
you make 42K on a single house build? damn, that's pretty good as aren't those house prices in the 250K-300K range, and include the land?
narlus said:
Specs are in the $180k-$190k range.. land included.
N8 said:
not so good at math, are we?
$67000 -$34900 -$6500 = $25,600
and are you saying anyone of us can just start doing what your doing?? I didnt think so
Maybe a home equity loan? If you sell a house that has appreciated considerably, you have instant equity in the new place.ghostrider said:
douglas said:
Ah... read the first post too quickly... sorry crashby. Not bad!
I know a couple of guys here who buy houses to flip but they do all work them selves and only make $8-$10k.
Where do you get 6k? I plan on making 20-23k on this one...N8 said:
buy - 35k
fix - 7k
misc. -8k
Sell - 68k
23k profit...
EDIT: OK - so we are all on the same page here - > Addendum:
keep in mind... all that rolled into a home equity line of credit where I will only pay 3 months of payment = = $1,300 out of pocket cash for the whole project.
The point is to never buy that porshe... you have your company lease anything you want, and keep it as a corporate business expenseghostrider said:
Wanted to post a couple of pics of the work in progress... Before and after pics:
Exterior...
Exterior...
Odd, I never noticed your reply...anyway, looks like you've got it all figured out. You should try to get on that TV show where they document this sort of thing.Crashby said:The point is to never buy that porshe... you have your company lease anything you want, and keep it as a corporate business expense
Attic -> Bedroom conversion:
Nice work so far...curbside appeal has definitely jumped up quite a bit!!!! Keep us updated 
actually I have been told to hold 3 corps, so that you can transfer assets prior to filing bankrupcy if necessary. That way you can shelter until you can start another corp. I am looking to do this hopefully by June, I will update then with actual scenario.Crashby said:
Wow, I can't believe that you can get any house for that cheep, here in massachusetts, the piece of land that that house is on would sell for about 150,000 bucks. Realistate is insaine here. it's impossiable to get a house for under 200,000
Finally some final "before & after" pictures... I had to wait until the window treatments were done 
.
Here is the exterior again:
and the basement:
.Here is the exterior again:
and the basement:
all 3 bedrooms:
Kitchen:
Bathroom:
Bathroom:
entryway:
and livingroom:
and livingroom:
Damn, you pimped that place up proper. Nice jorb
wow... nice job. Good luck with the sale.
WOW Crasby....very nice job! Is the house on the market yet? I'll be surprised if it takes a week to sell.
Any pics of the backyard?
Any pics of the backyard?
no backyard pics...I Are Baboon said:
My main worker kind of flaked toward the end of the project, and I had to get a replacement crew in there. So, it took a couple extra weeks to finish. Total rehab came in at $8,100 vs. projected $6,500.
Its been officially on the market for a week now, but the first showing (to three families) will be today.
nice job...I am digging the LR floor
Awesome job Crashby! Good luck with the quick sale!
Nice job.
Hope it sells quick.
Hope it sells quick.
damn... 35k for that house.. hell a parking space in Downtown L.A. wil run you $20k...
Located:
Im asking $74,900... expecting 71-72.
All up all in expenses (house, closing, taxes, repairs, etc.) to date = $45,850.
Im asking $74,900... expecting 71-72.
All up all in expenses (house, closing, taxes, repairs, etc.) to date = $45,850.
Excellent job Crashby! How much is it on the market for? Hopefully it sells quick. 
very nice work. good luck w/ the sale.
Sold yet?
SOLD! Got an offer last night. It took a little longer than planned... but I stuck to the higher asking price and got the full $74,900 that I wanted. I close in about 8 weeks. There is joy...