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Thursday, May 17, 2012
Andy Gustafson
Under the normal Internal Revenue Service, or IRS, code regulations you are required to pay capital gains taxes when you sell a property and realize a profit. Although the rate at which capital gains are taxed fluctuates, it is typically rather high given federal, possibly state capital gains and recaptured depreciation taxes. This tax can quickly eat away at the gain you realized on the sale... Read More
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Monday, May 14, 2012
Andy Gustafson
What should a Title Officer know about the Foreign Investment Real Property Tax Act (FIRPTA) and a 1031 exchange? What IRS forms need to be filed and when? How does a 1031 exchange impact the transaction and FIRPTA reporting requirements are all questions a Title Officer or Attorney will face prior to the closing on real property interests owned by a foreign person.
IRS Forms 8288
... Read More
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Thursday, May 10, 2012
Andy Gustafson
Taxpayers who are looking to reduce taxes on the sale of property often consider the possibility of entering into a Section 1031 Exchange in lieu of a straight sale. If the transaction qualifies, any capital gains taxes that would otherwise be due can be deferred until the sale of the replacement property. Among other requirements, a 1031 Exchange requires the seller to exchange the property... Read More
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Monday, May 7, 2012
David Shechtman, Esquire
In the wake of the economic downturn which commenced in 2008, gold and other precious metals have performed better than many other categories of investment assets. Taxpayers interested in avoiding capital gain taxes when they dispose of their appreciated precious metal assets are now looking to Section 1031 exchanges to defer their gains. For individual precious metal investors, a 1031 exchange... Read More
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Thursday, May 3, 2012
Andy Gustafson
Internal Revenue Code Section 1031 has many 1031 exchange rules that start with the code itself: “No gain or loss is recognized when property held for productive use in a trade, business or investment is exchanged for property held for productive use in a trade, business or investment.” A 1031 rule is to hold the property for the proper intent - or not for predominant personal use.... Read More
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Monday, Apr 30, 2012
Andy Gustafson
1031 services represent the accommodation of 1031 tax deferred exchanges. The Internal Revenue Code (IRC) Section 1031 states "no gain or loss is recognized when property held for productive use in a trade, business or investment is exchanged for property held for productive use in a trade, business or investment." The 1031 exchange defers the recognized gain or capital gains tax due until... Read More
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Thursday, Apr 26, 2012
Andy Gustafson
One of the fundamental rules of a 1031 Exchange is that the properties exchanged must be of “like-kind”. Given the importance of this rule, understanding what qualifies as “like-kind” is imperative to using a 1031 Exchange to your advantage. If the transaction qualifies for Section 1031 Exchange treatment though, the capital gains tax obligation can be deferred,... Read More
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Monday, Apr 23, 2012
Andy Gustafson
“Junk” bags of U.S. circulated silver coins such as dimes, quarters and half dollars minted before 1965 are eligible as replacement property in a 1031 exchange. These coins are typically traded in $1,000 face value and contain 715 to 770 ounces of silver, representing an inexpensive way to purchase silver per ounce. Fractional bags of 125, 250 and 500 silver dollars, in addition... Read More
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Thursday, Apr 19, 2012
Andy Gustafson
As a general rule, anytime you sell property, the gain you receive as a result of the sale is subject to capital gains taxes. For example, if you purchased a property five years ago for $100,000 and now wish to sell it for $150,000, you would be subject to paying capital gains taxes on the gain of $50,000. One strategy that allows you to defer capital gains is to enter into a 1031 Exchange.... Read More
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Monday, Apr 16, 2012
Andy Gustafson
In most transactions for the sale of real property, capital gains taxes are levied on any realized gain as a result of the sale. One way to defer the payment of capital gains taxes is to enter into a Section 1031 Exchange instead of completing a conventional sale of the property. In order to qualify for 1031 Exchange consideration, the property exchanged must meet very strict guidelines,... Read More
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Thursday, Apr 12, 2012
Andy Gustafson
A 1031 exchange can be explained in three ways. It is when a real or personal property held as an investment or for use in a business is sold and replaced with like-kind real or personal property held as an investment or for use in a business. It is an interest free loan or tax deferral. It is a section of the Internal Revenue Code Section 1.1031.
Proper Intent
Each 1031 exchange is... Read More
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Monday, Apr 9, 2012
Andy Gustafson
In a traditional sale of property, the seller is required to pay capital gains taxes on any gain realized in the sale. One way to avoid paying capital gains taxes is to defer payment by entering into a Section 1031 Exchange. As the name implies, a 1031 Exchange contemplates an “exchange” of like-kind property instead of a traditional sale. If the transaction qualifies, any... Read More
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