CalculateRealEstateROI

House Flipping

How are flips taxed?

As ordinary income plus self-employment tax — typically 25–40% total.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Direct answer

As ordinary income plus self-employment tax — typically 25–40% total.

Expanded explanation

Flips are dealer activity, not capital gains. Frequent flippers may be classified as dealers, losing 1031 and capital-gain treatment. Consider S-corp election to manage SE tax.

Examples

  • $50k profit at 25% federal + 15.3% SE = ~$20k tax.

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