The Fix and Flip Life Cycle

  1. Direct materials
  2. Direct labor
  3. Utilities
  4. Insurance
  5. Equipment Rentals
  6. Mileage (see previous article for additional details)
  7. Insurance
  8. Mortgage interest — Make sure to get a statement of interest if you are using a hard money loan
  9. Real estate taxes — you must calculate them as follows:
  10. Staging
  1. Legal and professional fees
  2. Travel and meals (i.e. out of state investor visiting the properties or looking at additional subject property in an area where the investor already holds property).
  3. Telephone (deduct what is business related)
  4. Education/books
  5. Seminars
  • Purchase Date: 5/10/2021
  • Purchase price: $80,000
  • Rehab costs: $50,000
  • Other costs (i.e. insurance, taxes, interest): $8,000
  • All in costs (purchase price + rehab costs + other costs): $138,000
  • Sales Date: 9/15/2021
  • Sales Price: $175,000
  • Sales expenses: $10,000
  • Net sales price: $165,000
  • Profit (net sales price — all in costs)
  • Total amount to be reported as income in 2021 = $27,000
  • Purchase Date: 10/10/2021
  • Purchase price: $80,000
  • Rehab costs: $50,000
  • Other costs (i.e. insurance, taxes, interest): $8,000
  • All in costs (purchase price + rehab costs + other costs): $138,000
  • Sales Date: 2/1/2022
  • Sales Price: $175,000
  • Sales expenses: $10,000
  • Net sales price: $165,000
  • Profit (net sales price — all in costs)
  • Total amount to be reported as income in 2021 = $0
  • Total amount to be reported as income in 2022 = $27,000

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GC Realty & Development, LLC.

GC Realty & Development, LLC.

Full-service Real Estate firm specializing in Residential & Commercial acquisitions as well as property management in the Chicagoland area.