Fliperati

Not the most riveting topic, I know, but taxes and bookkeeping are clearly tremendously important issues in the universe of real estate investment.  There are countless books and seminars on both points within this category, so I don’t expect anyone to glean any earth-shattering insights from anything I post here (WARNING: I am neither a tax attorney nor a qualified accountant!!).  What I expect will be interesting is following the real life trajectory of my successes and failures in this arena.  From the reading I’ve done to-date (a few examples here and here), I think I’ll setup an LLC taxable as an S Corporation for the flipping enterprise.  I’m in the process of setting up a few interviews with accountants and real estate/tax lawyers, so I’ll report back with the end result after I have a team assembled and paperwork filed.  Fast-forward three years into the future and I’m either paying $5 dollars in taxes per year and enjoying life on a tropical island, or I’m deep in the red after closing a number of seemingly profitable deals only to find out that everything was a net loss after taxes.  Wish I had a crystal ball…

Irrelevant side note: The first accountant I am meeting sounds like a lovely, intelligent woman over the phone — an impression that is strongly reinforced by her raging British accent.  Charming as this may be, it gives me pause in seeking her services because in order to develop such a thick accent, I would assume she must have grown up in an equally raging part of the United Kingdom (or one of its many former colonies and protectorates).  I would think that growing up listening to your parents rant and rave against all-things-IRS every April would be a necessary condition for having a strong understanding of the outrageously byzantine US Tax Code and practicing accounting, but I guess I can test that theory next week when I chat with Lady Tax Advice directly.