1031 Exchanges Involving Multiple Properties

Posted by Tom Gustafson on Wed, Mar 14, 2018

If you are a tenured investor who has built a portfolio of diverse properties, a 1031 exchange is an exceptional tool to assist in continuing to add to, diversify or consolidate your holdings. A common misconception exists around 1031 exchanges that a single investment property must be exchanged for a single like kind investment property. This is incorrect.  In fact, the ability to trade a single investment property for multiple properties, or in reverse; multiple properties for a single property gives the savvy investor the flexibility to adjust their portfolio according to their needs.

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Tags: 1031 tax deferred exchange, 1031 tax exchange, 1031, 1031 exchange rules, 1031 exchange, 1031 property, 1013 multiple properties

1031 Exchange and the Orlando, Florida Real Estate Market

Posted by Tom Gustafson on Fri, Mar 02, 2018

Long thought of as the retirement capital of the United States, Florida is reinventing itself as the new national destination for real estate investment. According to a February 2018 Forbes article, “Best Buy Cities: Where to Invest in Housing in 2018”  by Samantha Sharf, Orlando is ranked first in the country for value in real estate investment. Sharf and the team at Forbes highlight Orlando’s 7.1% job growth over the last two years as well as the 7.6% population growth over the past three years  as strong factors in addition to their Local Market Monitor’s speculation that the prices of homes in Orlando could increase another 35% by 2021. With Orlando’s average home value still sitting roughly 22% below the national average, the opportunity for first-time and long-time investors to build or expand their portfolio has never been better.

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Tags: 1031 exchange explained, section 1031, 1031 tax exchange, tax free exchange, 1031 exchange rules irs, deferred gain, 1031 property, 1031 exchange intermediary

First Step in a 1031 Exchange

Posted by Andy Gustafson on Thu, Aug 22, 2013

For taxpayers owning investment property or business owners with personal property considering a 1031 exchange, the first step is to visit your CPA to determine the tax consequences. Without knowing the tax before initiating the exchange, the taxpayer is assuming it makes sense to initiate the 1031 exchange. All too often taxpayers want to initiate an exchange without knowing the value or the reason to exchange other than to exchange for another property. That in itself is a good reason to exchange but for those taxpayers who want to justify the exchange expense, a 1031 exchange should start with a review of the realized gain on the sale.

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Tags: 1031 tax exchange

Why Use a 1031 Tax Exchange

Posted by Andy Gustafson on Tue, Apr 23, 2013

The taxes due on the capital gains and claimed depreciation upon the sale of an investment property can be quite substantial, often times to the point where any possible profit on the sale can be eliminated. Enter the 1031 tax exchange. Title 26, Section 1031 of the Internal Revenue Code states that, "no gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment if such property is exchanged solely for property of like kind which is to be held either for productive use in a trade or business or for investment." No gain or loss recognition ultimately means that no taxes are due upon the sale of the old property, or temporarily deferred which can be highly beneficial. The benefits of completing a 1031 tax exchange obviously lie within the tax benefit realm. Here are a couple of reasons to use a 1031 tax exchange.

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Tags: 1031 tax exchange

1031 Tax Exchange

Posted by Andy Gustafson on Tue, Apr 16, 2013

Most often associated with investment real estate, the 1031 tax exchange is an effective way to delay (but not forgive altogether) the payment of federal, state and local capital gains and recaptured depreciation tax for property that is held for the productive use in a trade or business or for investment upon sale. It's important to understand the concept of the 1031 tax exchange and also certain rules that must be followed in order for the tax deferment to be allowed via IRS Regulations.

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Tags: 1031 tax exchange

1031 Tax Exchange Benefits

Posted by Andy Gustafson on Tue, Mar 05, 2013

The 1031 Tax Exchange is a section in the U.S. Internal Revenue Service Code which allows investors to postpone capital gains taxes during an exchange of like-kind properties for investment or business purposes. Thus, capital gains or taxes are not imposed on a property sold if the net equity plus debt retired is used to buy another property of equal or greater value. Tax payment is deferred until such time that the replacement property is sold without initiating another 1031 exchange. 

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Tags: 1031 exchange explained, 1031 tax exchange

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