The books behind the buildings.
Whether you build to sell or buy to hold, real estate is taxed on what you do with a property. The same building can mean ordinary income, a capital gain, or a tax loss depending on how you hold it. Because those paths are so different, we split the guidance the way the tax code does:
Which describes you?
Rental Property Owners
Long-term and short-term rentals: the passive-loss rules, the short-term-rental treatment, material participation, cost segregation, and per-property basis tracking.
Learn more →Builders & Build-to-Sell
Spec homes, remodels, and development held for sale: dealer status, ordinary-income treatment, job costing by project, and the entity separation that keeps it clear of your hold portfolio.
Learn more →Agents, Brokers & Brokerage Offices
Commission income on a 1099, self-employment tax, quarterly estimates, and an S-corp question that turns real once production is steady. In Texas the entity has to be registered with TREC before your broker can pay it: register first, elect second.
Learn more →Cash flow is not taxable income.
Whichever road you’re on, real estate is the rare business where a property can put cash in your pocket and a loss on your return in the same year. Depreciation drives the result. The passive-loss and dealer rules decide whether you keep it. Every real estate engagement we run tracks the cash number and the tax number separately, per property or per project, because the gap between them is where the planning happens.
Real estate, at a glance.
Can I take my commissions through an S-corp in Texas?
Yes, but the order matters. Texas Occupations Code §1101.355 requires a business entity that receives compensation on a license holder’s behalf to be licensed as a broker. Since January 2024, it may instead be registered with TREC under the exemption for an LLC or S-corp owned at least 51 percent by the license holder and used for nothing else. Register the entity first; make the tax election second. A broker who owns a brokerage is usually on the licensed-entity path instead. We handle the election, the payroll, and the books, and tell you plainly where the license rule sits. Entity formation itself is confirmed with TREC and your attorney.
I both build to sell and hold rentals. Where do I start?
Both pages apply, and keeping the two activities in separate entities and ledgers is exactly the point. Build-to-sell is dealer activity taxed as ordinary income. Holds are investment activity that can reach capital-gain treatment. Mixing them lets the dealer character contaminate your investment gains. Start on the page matching your larger activity, and we’ll structure both correctly in the first conversation.
What’s the single biggest real estate tax mistake you see?
Untracked basis and suspended losses. Every property builds a history of improvements, depreciation, refinances, and suspended passive losses, and it all comes due at sale. An owner who never tracked it per property has to rebuild years of history at sale, and often overpays because favorable items got lost. We keep a live per-property ledger so sale day is arithmetic.
Do you work with out-of-state and nationwide real estate investors?
Yes. We’re based in Montgomery County but virtual-first, and real estate is inherently multi-state. We handle the apportionment, multiple state filings, and per-property books for investors holding across state lines, all through the secure portal.