Preparing for Taxes as a Rehab Investor

As we have mentioned in previous blog posts, including Building Your Team: Who the Seasoned Investor Knows, it is important to add trusted professionals to your rehab investment team.  One important team member to have is a CPA, or financial advisor.  CPAs will be able to answer all your tax questions and direct you to get the most out of your tax return.  Remember to keep all tax documents for up to at least 7 years.

CPAs will tell you to keep track of everything.  Over documenting is better than missing something.  It is important to keep all bills and receipts that pertain to your real estate rehab business.  Your CPA will be able to tell you what is tax deductible and what category it should be placed under.  To help with tax preparation, put your receipts into folders by category.

Read examples of tax deductions here.

Some self-employed individuals find it helpful to keep a calendar full of payments, purchases, miles, etc.  This allows them to look back each month to see their business activity.  How do you handle preparing for taxes?