Archive | Section 1031 Basics

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Tax Fatality

The sellers of real property are often to preoccupied with the “Sale” to realize that if they were more strategic in their investment decisions, they could reap long term financial benefits.  The concept is simple, don’t touch the cash!  The object in an exchange is to defer the capital gain tax, recapture of previously taken […]

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Hurdles

3 Tax Hurdles

When potential clients call to find out what the capital gains rate is, they usually think “oh, that’s not so bad”.  What they fail to understand is that there are three tax hurdles to overcome on the sale of a capital asset. The first hurdle is largely misunderstood and it can be very costly.  Upon […]

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The_Right_QI

How To Choose The Right Qualified Intermediary (QI) for your Section 1031 Exchange

Consumers shopping for financial services have for too long relied on the oversight of various regulatory agencies to provide a safe and secure business environment.  The mark of a few initials (BBB, SEC, FDIC, etc.) has been considered insurance enough that individual firms are reputable and trustworthy. The meltdown of the financial markets in 2008 […]

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Section 1031 Related Party Rules

When conducting Section 1031 transactions with a related party the simple rule is that you can sell to a related party, but you cannot purchase from one. The IRS rationale is that the taxpayer is essentially “cashing out” or basis shifting in related party transactions. Exchanges between related parties can be conducted under special circumstances; […]

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Trading Up Using the 1031 Exchange

In spite of decreasing real estate values across the nation, real estate investors continue to come up with innovative ways to make their investment turn out profitably. A powerful method for building real estate holdings is the use of 1031 Exchanges, which lets investors defer capital-gains assessment on investment property by reinvesting sale proceeds into […]

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Rules Schmules – Get Some Advice

In its simplest terms, Qualified Intermediaries (QI), facilitating Section 1031 Exchanges, act as a third party in the sale of Relinquished Property (old property). The QI’s job is twofold:   a) memorialize and document the intent of the taxpayer and b) function as escrow agent for the net proceeds from sale. Section 1031 is a tax […]

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