How can I qualify to pay NO taxes when I sell my property?
Any investor can qualify! Section 1031 of the IRS code lets you sell
your property and buy a new property without paying any taxes. You simply
follow specific rules. That's where we come in. As a professional qualified
intermediary, we'll help you qualify and gain the advantages of a 1031
tax free exchange.
What is a qualified intermediary?
That's us. The IRS says if you touch the money you pay the tax. However,
if you use a qualified intermediary to transfer the money from the sold
property into the purchased property, you qualify for a tax free exchange.
The IRS does not permit your accountant, attorney, or escrow company
to be your qualified intermediary. As a professional qualified intermediary,
we are members of the Federation of Exchange Accommodators and bonded.
Can I get legal or tax advice from you?
No, the IRS doesn't allow us to act as both your qualified intermediary
and your attorney or tax advisor. So we will work with your attorney
and CPA to make sure your tax free exchange goes smoothly.
Can I avoid paying taxes forever?
Yes, you can. By simply following the 1031 exchange rules every time
you sell one or more properties and buy replacement properties, when
you die your estate escapes all the capital gains taxes forever!
What exactly are the tax advantages in exchanging?
You can eliminate paying any capital gains taxes, and you can eliminate
paying the even higher-rate taxes on the recapture of depreciation you've
taken on your property. By exchanging into a higher priced property you'll
also gain additional depreciation deductions which can increase your
after-tax income.
Are there reasons to exchange other than tax advantages?
Yes, there are many non-tax reasons to exchange. For example, if you
no longer like managing property, you can exchange your management intensive
property for triple-net management free property, or exchange multiple
smaller properties for one that can be professionally managed. Or, say
your current property cannot be easily refinanced. You could exchange
out of that property for a new property which could be refinanced more
easily so you can take some cash out. Or, you might exchange to improve
cash flow.
What kind of real estate qualifies for a 1031 exchange?
Almost every kind of real estate is considered "like kind" and can be
exchanged for any other real estate, including vacant land for apartments,
a rental house for a shopping center, an office building for a leasehold
interest with 30 years or more remaining, as long as you hold them for
investment or business use. Check with us on the specific properties.
Can I buy a new property before selling my old one?
Yes, you can buy a new property before selling the old property and
still qualify - it's called a "reverse" exchange. The qualified intermediary
takes title to the new property you buy and holds it for you until you
sell your old property.
Using an IRA for real estate requires a special Self-Directed IRA. Your Self-Directed IRA at Charles Schwab or Fidelity does NOT permit you to hold real estate or any asset other than securities. This can be solved by moving your IRA to a custodian that allows for real estate in the plan document.
With the right Self-Directed IRA (known as Real Estate IRA) and proper structuring, you partner with your IRA to buy leveraged real estate. When it comes time to sell, you can 1031 your portion of the gain while the IRA gets its portion of the gains tax exempt.
How do I exchange into a larger property (trade up)?
You trade up by getting a bigger loan on the new property, or adding
cash, or equities in other properties, or notes carried back from the
sale of other properties, etc. Done right, it's all tax free.
Can I refinance without blowing the tax free exchange?
Yes, you can refinance the property you are selling before you exchange,
or refinance the property you are buying after you exchange, and the
proceeds are tax-free. Check with us for the details as the timing and
contract dates are critical.
I've already sold my property. Can I still do an exchange?
Yes, provided your sale has not closed yet, simply contact us and we
will turn your taxable sale into a tax free exchange with some simple
paperwork. You can call us right up until the day before closing.
What does it cost to do a 1031 tax free exchange?
* Non-money market. You do not receive interest on
your funds awaiting reinvestment. No cancellation fee if you don't find
a replacement property. Only $495.
* Money market. You receive interest on your funds
awaiting reinvestment. No cancellation fee if you don't find a replacement
property. Only $995.
Okay, so how do we get started?
Call us toll-free today at 866-944-1031. There's no
charge, you'll talk with an exchange expert who has been guiding people
through exchanges for more than 10 years, and you'll get straight answers
to every question you have. Call today, you'll be glad you did! If you
would like us to call you please
let us know here.
"Your creative solutions for my clients' complex
exchange transaction saved her from having to pay over
$50,000 in capital gains taxes! Thank you for making
a complicated situation simple." Ben B
Realtor, Keller Williams Realty
