Contact UsI just became a Realtor and need to know if real estate I purchase as investment properties (land, homes and commercial) is treated as inventory and thus is taxed as ordinary income or is it treated as capital gains upon sale? If it is the former, does this mean I file it with my schedule C realty business and handle all expenses and income on the same schedule?
TaxConnections Members... Answer This Question
Want To be One of Our Tax Experts? Register Here
Tax Professional Answers
William Keats
You purchased these properties as investment properties, I am assuming these are for your own account, in which case the sales would be subject to capital gain on Schedule D. If, however, the properties were sold in the ordinary course of business as a realtor, through your agency, then it is
considered as 'Inventory', in which case the sale would be included on Schedule C.
Leave a Comment
588 weeks ago
considered as 'Inventory', in which case the sale would be included on Schedule C.