How is a real estate development company taxed on its profits/flipped property sales?

Question

Suppose I am the sole owner of a real estate development LLC. If I bought a property (to flip) through my company (the owner of the property is my company, not me) and sold it for a profit, would that profit be taxed for capital gains and then taxed again as the LLC's profit (which from what I understand would be reported as my own income on a regular 1040 form)? Or is that profit only taxed once as either capital gains or my income/the LLC's income? Thanks!

Answer 1

You need to talk to an accountant. If you have things set up right, it will only be taxed once, but I can't tell whether your LLC is properly set up without more information. Also, if it is truly a company that regularly buys and flips real estate, the bad news is that the real estate may be inventory, and you many not get capital gains rates. Lots of variables here. Talk with an accountant and give them the details.