Real Estate Professionals

[georgeshalaby]

For Real Estat Professional, how do we account for their purchase of real estates property and selling of it, do we count for it all in schedule C ? So The purchase of the property is a cost of goods sold and the sale of the property is The income ? or how we account for it ?
I'll really appreciate any Feed back
Thanks

[Gretel]

Your post does not give enough information to really give any response but I have a hunch that you might be confusing the terms "Real Estate Professional" and "Real Estate Dealer". Maybe you want to describe your situation in more detail first.

[Burke]

Gretel is correct. Need a little more information. If your client buys land, then subdivides and sells the lots, or buys improved real estate whether he fixes it up or not, then sells it without occupying it himself or putting it into service as rental property, then he is considered a dealer and the sales go on Sche C. Gross sales are reduced by his basis (cost) in the property. The net profit is subject to SE tax.

[WhiteOleander]

Welcome to the board.

[georgeshalaby]

Thank You for your respond

Your post does not give enough information to really give any response but I have a hunch that you might be confusing the terms "Real Estate Professional" and "Real Estate Dealer". Maybe you want to describe your situation in more detail first.

Thank you for your respond

[georgeshalaby]

Thank you very much for your response

Gretel is correct. Need a little more information. If your client buys land, then subdivides and sells the lots, or buys improved real estate whether he fixes it up or not, then sells it without occupying it himself or putting it into service as rental property, then he is considered a dealer and the sales go on Sche C. Gross sales are reduced by his basis (cost) in the property. The net profit is subject to SE tax.

Thank you very much for your response