Question by mrflip: Would a c-corp work for someone “flipping houses” for tax benefits?
I am looking into the business of flipping houses, so after reading more into it I see that it is recommended to operate under a “c-corp”. After talking to a CPA they said it would make no sense as I would be double taxed, both on the corporate profit and my personal income from the corporation. Why is it that most real estate books recommend c-corps then for tax breaks on buying and selling houses?

Best answer:

Answer by bostonianinmo
Probably because most real estate books are not written by tax experts. Sadly, few of them are written by real estate experts either, but that’s another story.

You’ll pay higher tax rates in a C-Corp, plus there are no personal exemptions or deductions so the first dollar of profit is taxed. You will have to pay yourself a reasonable wage but any other funds you take out as dividends are taxed twice, once as income of the corp and again as taxable dividends to you.

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