We bought a house to flip in 2018 and sold in 2019. We have done this in the past and filed a schedule c. What do me claim in 2018

[Coleen3 · Accepted solution]

Nothing. 

Since this was purchased as an investment to fix and resell, you add the carrying costs including mortgage interest, property taxes and rehab expenses to the basis of the property. When you sell it, all of these costs (and others from the purchase) become part of the adjusted basis for determining gain or loss on the property. Property taxes are added to the basis and are not deductible on Schedule A since they are considered a business expense, not a personal one, because of the status as an investment property.