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I foolishly agreed yesterday to prepare the 2021 returns for a panicked client who forgot I retired and, of course, in addition to the normal 1 W2, he bought a house in July 2020 to flip and sold it in February 2021.
I haven't had a client with this situation previously and after researching Pub 544, I believe this is investment income with a short term capital gain result. Taxpayer did not live in or try to rent the house. Form 1099S was not issued.
Am I correct to report it as an investment on Schedule D? Thank you.
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But is the flip a one time shot or the start of a flipping career?
Slava Ukraini!
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Taxpayer mentioned he has done this before, just not in the 4 years he has been my client. Not sure of the future plan.
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Multiple times pushes you closer to schedule C reporting instead of D.
Slava Ukraini!
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OK, I understand how that would happen. I'll mention it to him. Thanks.
