2,684,109
Legally defer Federal income taxes (capital gains taxes) by using IRC Section 1031 to exchange "Like Kind Properties". Also known as a Starker Exchange. You need a Qualified Intermediary. Many Title Attorneys offer services as a QI, so do many CPAs.
You are dealing with the IRS, you MUST comply with exact timelines and other requirements. Talk to the QI, or your own lawyer, or a CPA for details before embarking on a Section 1031.
Reporting will be done on IRS Form 8824. Follow these Instructions for IRS Form 8824
*Personal example: My investor friend sold 4 rental townhouses here in Tallahassee, he profited $400K. We used the Section 1031 to purchase a vacation rental house in North Carolina with the $400K, and deferred paying capital gains tax.
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Kevin J. May
Hobe Sound, FL
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Ryan Huggins - Thousan...
Thousand Oaks, CA
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Mary Yonkers
Erie, PA
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Anthony Acosta - ALLAT...
Atlanta, GA
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Debe Maxwell, CRS
Charlotte, NC
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Diana Dahlberg
Pleasant Prairie, WI
3,345,091
I wish you all the best with your real estate school studies and in your real estate career.
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Anthony Acosta - ALLAT...
Atlanta, GA
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Tony and Suzanne Marri...
Scottsdale, AZ
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Nina Hollander, Broker
Charlotte, NC
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Debe Maxwell, CRS
Charlotte, NC
2,178,603
It's all about using competent professionals to sell one property and buy another, under very specific guidelines, to defer capital gains taxes.
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Mary Yonkers
Erie, PA
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Anthony Acosta - ALLAT...
Atlanta, GA
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Debe Maxwell, CRS
Charlotte, NC
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Diana Dahlberg
Pleasant Prairie, WI
5,583,278
with the guidance of an attorney who is well versed with a 1031 exchange
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Anthony Acosta - ALLAT...
Atlanta, GA
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Nina Hollander, Broker
Charlotte, NC
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Debe Maxwell, CRS
Charlotte, NC
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Diana Dahlberg
Pleasant Prairie, WI
6,393,494
Best to proceed with competent experienced professional advice.
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Anthony Acosta - ALLAT...
Atlanta, GA
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Diana Dahlberg
Pleasant Prairie, WI
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Michael Jacobs
Pasadena, CA
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Bob Crane
Stevens Point, WI
5,230,102
Fred Griffin gave you a great answer.
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Mary Yonkers
Erie, PA
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Fred Griffin Florida R...
Tallahassee, FL
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Anthony Acosta - ALLAT...
Atlanta, GA
3,988,007
1031 exchanges are an excellent way to shelter qualifying sales from immediate payment of income tax due on the gain. There is much written about how this works and also many excrow handlers that do this type work. I suggest getting one of them in your area to coach you and explain the pros and cons. Don't promote yourself as an agent doing these until you know the ins and outs.
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Kevin J. May
Hobe Sound, FL
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Anthony Acosta - ALLAT...
Atlanta, GA
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Debe Maxwell, CRS
Charlotte, NC
7,836,139
Follow the instructions of the CPA.
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Anthony Acosta - ALLAT...
Atlanta, GA
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Diana Dahlberg
Pleasant Prairie, WI
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Michael Jacobs
Pasadena, CA
2,220,654
That depend on each individual, it's best to have your investor talk to you trusted 1031 Exchange provider and find out their options.
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Mary Yonkers
Erie, PA
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Anthony Acosta - ALLAT...
Atlanta, GA
5,104,931
I have no idea... in 25 years have never had a single client, investor or not, do a 1031 exchange. You should get advice from an accountant, lawyer or financial planner here.
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Anthony Acosta - ALLAT...
Atlanta, GA
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Mary Yonkers
Erie, PA
5,216,409
Utilize the services of a CPA, real estate attorney, qualified intermediary or a combination of them.
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Anthony Acosta - ALLAT...
Atlanta, GA
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Nina Hollander, Broker
Charlotte, NC
1,622,432
Taxes are the main benefit.
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Anthony Acosta - ALLAT...
Atlanta, GA
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Mary Yonkers
Erie, PA
679,404
I would refer this to my title company ... they have handled them in the past for some of my clients.
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Mary Yonkers
Erie, PA
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Debe Maxwell, CRS
Charlotte, NC
1,525,616
5,049,450
Fred Griffin has a good answer. Something to also discuss with a CPA.
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Fred Griffin Florida R...
Tallahassee, FL
1,153,794
Any time you can defer capital gain it's usually a good thing. A Starker or 1031 Exchange is the vehicle to accomplish that in Real Estate. The "like kind" property requirements have softened somewhat so there's more leeway for investors now but essentially it's a way to save on taxes for the time being.
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Fred Griffin Florida R...
Tallahassee, FL
1,502,998
Through a qualified intermediary. You can exchange "like for like" but the definition of "like" is very broad. You can 1031 a rental unit to a commercial property, mutual fund, another single family rental or any other form of "investment vehicle." The qualified intermediary will have all the information you need (they do the faciliation of the exchange).
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Fred Griffin Florida R...
Tallahassee, FL
1,231,853
1031 exchanges exist but I am not interested. Good luck in class.
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Anthony Acosta - ALLAT...
Atlanta, GA
4,800,082
By following the guidelines that are published by the IRS.
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Anthony Acosta - ALLAT...
Atlanta, GA
3,071,489
4,319,419
Rachel Greene - work closely with your financial advisor of a CPA.
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Praful Thakkar
Andover, MA
3,986,258
Contact a professional 1031 exchange company and get the correct info
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Anthony Acosta - ALLAT...
Atlanta, GA
3,164,294
carefully with the proper folks in place to make sure it's all handled correctly. Not all attorneys in my state will close those transactions or can hold funds.
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Debe Maxwell, CRS
Charlotte, NC
1,712,676
It works through a third party accomodator company while all the money stays in escrow if the investor wants to avoid taxes. 45 day id period and six months to close.
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Debe Maxwell, CRS
Charlotte, NC
2,071,025
1,598,452
5,868,554
900,128
It's a long answer, best to look it up and get the most recent legal details/tax status, etc.
4,160,899
1,239,901
defer capital gain tax. Rules have changed on business related topics. Please consult with a CPA or 1031 professionals.
1,466,207
Rachel Greene All an investor has to do is own a property they wish to defer taxes on should they sell.
3,416,038
In 32 years of real estate i have only had 1 of these. Not sure why, but investors here seems to buy, fix and sell.
2,182,552
4,882,355
4,434,127
5,772,575
Rachel,
There are entities that manage 1031 exchanges. These third parties often offer free courses as to what is involved. My suggestion is that you take one of these courses. You will learn much more than you can here. A