Go | New | Find | Notify | Tools | Reply | |
| Green grass and high tides  |
I am looking into the process. I have some knowledge but looking to make sure there are not any things I am missing in the process. Any details on the process would be appreciated. I have a property I am considering selling a repurchasing another piece of what I am calling "like property". neither is a primary residence and I do not think it matters but both properties are in different states Thanks guys and gals. "Practice like you want to play in the game" | ||
|
| Big Stack |
Do you have a lot of unrealized gain in the first property? Do you have the property to purchase lined up and ready to go? There are pretty strict time limits. If you don't have a lot of profit to protect, the PTIA factor, and likely cost, may not be worth it. I don't know the whole process. I do know you need an intermediary to process it and I think hold the funds between sale and purchase. Find one of those locally and they'll probably be happy to answer you questions, and have the necessary knowledge. | |||
|
| Needs a check up from the neck up  |
Email sent with everything you need. __________________________ The entire reason for the Second Amendment is not for hunting, it’s not for target shooting … it’s there so that you and I can protect our homes and our children and and our families and our lives. And it’s also there as fundamental check on government tyranny. Sen Ted Cruz | |||
|
| Just because you can, doesn't mean you should |
I think you have to do it through certain attorneys (qualified intermediaries) that have some sort of license and escrow accounts for them, and they hold the funds between sales. Also consider that the income tax and capital gains taxes may go up in the future and taking that now or maybe finding a way to spread the income over this year and next, if that's possible, might be a better approach. Might ask a CPA or tax attorney too or maybe one here will chime in. Here's an article that covers a lot of the bases. https://www.investopedia.com/f...-1031-exchanges.aspx ___________________________ Avoid buying ChiCom/CCP products whenever possible. | |||
|
Political Cynic |
you might also need a cost segregation study to figure out what property needs to be excluded | |||
|
| Green grass and high tides |
Thank you guys. Great info. Email received Timdogg6. Thank you very much. "Practice like you want to play in the game" | |||
|
| Member |
Next week I will be closing on a 1031, I exchanged a rental house I have owned in suburban San Francisco since 1998 For farm and ranch land in North Dakota. I used a intermeadiatory company called Exchange Services Inc in Whitefish MT. They were excellent too work with, and I believed they only charged me $1500. The Tennant in that house went on Covid relief, never paid rent for over a year and disappeared. My experience is that 45 day replacement selection period (or whatever they call it moves fast, real fast. ).For many reasons closing dates can slip, properties can mysteriously disappear from the market. In our case we received a over asking, all cash, no contingency , 7 day close offer on our house. Around here anyway, most agriculture land sells at public auction You don't have any idea what it is going to sell for. Many things go into it you have no control over Now I have to send California a report every year telling them I still have it. I wonder if I mite have been better paying the tax. The taxes are only defered. They are going to get higher most likely. Maby I could have saved a lot on the next land purchase if I could have taken my time. Maby I just should have cashed out and had fun spending the money. Now I am told that if I use it for personnel use , such as hunting pheasants, that could be considered conversion. | |||
|
| Ammoholic |
If you are worried about the tax going up, I wonder if you can elect conversion (or force conversion by hunting pheasants), pay the tax, and move on. If so, maybe you wasted some time and effort doing the 1031, but at least you aren't worried about the taxes down the road... | |||
|
goodheart |
So far the Brandon administration hasn't succeeded in getting their planned gutting of 1031's through Congress, but it could happen. They wanted to eliminate 1031's, and also wanted to end the step-up in basis of property on inheritance. That would have killed 1031's and had a huge negative effect on the real estate market. There was a lot of lobbying by the real estate industry. They may still limit 1031's to below a certain income level, or make a maximum amount per year per taxpayer. We've done two 1031's, buying three properties (two in Arizona, one in California) in exchange for two in California. As noted above, the biggest hassle is the 45-day period to identify a property. When we were looking for the first 1031, there was very little on the market; we did manage to find a little house that has increased a lot (on paper) in the San Diego area. One must be careful if there is any plan on using it in the future as a residence. It has to be rented out for two years first to avoid paying the capital gains tax. _________________________ “Remember, remember the fifth of November!" | |||
|
| Member |
If you are worried about the tax going up, I wonder if you can elect conversion (or force conversion by hunting pheasants), pay the tax, and move on. If so, maybe you wasted some time and effort doing the 1031, but at least you aren't worried about the taxes down the road...[/QUOT E] Thank you sir, you have put into words random ideas I have had floating around my mind. Now I am having nightmares, , I am in federal prision on tax fraud an some rough looking gangster asked me what I am in for, and I say I hunted pheasant. The great irony is most of my retirement money is in a tax deferred 457 retirement account, and I am in a much higher tax bracket now than I was when I was contributing to it. I understand, a first world problem for sure. I wish now I never would have deferred tax on anything. As far as the people that are using 1031 exchanges to by income producing rental homes ,then moving into them after 2 years (2 years tax returns anyway) , does this really work ? | |||
|
| Powered by Social Strata |
 | Please Wait. Your request is being processed... |
|
© SIGforum 2024