Paying taxes on deals

[LateThanNever]

I have read on this board that an LLC is not required if you are just wholesaling...no assets, so no assets to protect.

My question is how are taxed paid on money made on wholesale deals or any similar deals?

No such thing as "free" money, right?

[Figureditout]

It is still taxed as income  So you can plan on being 1099 by the Investor that pays you for finding the deal.

[LateThanNever]

Just a couple more questions:

Do I need a business license before accepting money for an REI deal?

Can I deduct business expenses such gas, business cards, bandit signs, etc.?

[mcwagner]

This income will be taxed on your 1040 Sch C same as any other business.

All business expenses are deductible on the Sch C.  These include: business mileage on your vehicle, office suppies, business cards, advertising, business cell phone, education/training, commissions or fees paid out, etc.

You can deduct mileage OR actual vehicle expenses (gas, oil, etc) but not both.  Most people come out ahead with mileage, plus its simpler.  Get a 99 cent mileage log from office max and use it EVERY TIME YOU GET IN THE CAR.

FYI, the assets that the LLC protects are your personal assets, not business/real estate assets.  The reason you don't "need" an LLC for wholesaling is that the risk is low (not dealing with tenants/public) not that the business doesn't have any assets. 

[LateThanNever]

Ok, just to recap:

1. I will be "given" 1099 forms for each wholesale deal completed.
2. I will have to file a 1040 Sch C where I will list all business expenses.

Another question, though...I have a regular job (non-real-estate related). Do I have to file a separate 1040 EZ (form I have filed in the past)?

[mcwagner]

1.  You may or may not receive a 1099.  The 1099 is for the IRS to let them know how much you made.  You need to report your income on Sch C whether or not you receive a 1099.

2.  Your W-2 will go on your 1040 along with your Sch C income.  You should not file two tax returns.