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Monthly Archives: November 2010

Can a trust holding a property do a 1031 exchange? There are 3 beneficiaries. Can there be 3 separate properties after the exchange?

Tuesday, November 30, 2010

Trusts can do a 1031 Exchange, we do them all of the time, but like LLC’s and LTD’s, they have to be executed as a single entity. If the goal is to purchase 3 separate properties for the 3 beneficiaries, we recommend selling the property as a single trust, purchasing the 3 properties as a [...]

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I own property in Puerto Rico and want to 1031 Exchange it for property in Wisconsin. Can I do a 1031 Exchange this way?

Tuesday, November 30, 2010

The location of properties being exchanged is very important. Real property located outside the United States does not qualify as a 1031 Exchange property if exchanged for real property located in the United States. In the US, real property means property located within the fifty states and the District of Columbia. Property located in Guam, [...]

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How much does a 1031 Exchange cost?

Tuesday, November 30, 2010

Qualified Intermediaries charge anywhere from $300 to $3000 per 1031 exchange. Like most industries the prices are market driven, when demand is high prices go up, and the reverse when demand goes down. Realty Exchangers is a 20-year Qualified Intermediary for IRS 1031 Exchange. Our prices have always been in balance with current market conditions. [...]

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Can I take a note on the sale of my Relinquished Property and still qualify for a 1031 exchange?

Monday, November 29, 2010

Yes! Realty Exchangers, Inc., regularly manages these types of transactions and knows the correct procedure that must be followed to assure §1031 Exchange treatment. The installment note and related documents are made out in the name of the QI (Qualified Intermediary). There are four choices on how to use it to buy replacement property: You [...]

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Are 1031 exchanges exempt from the 3.8% real estate gains (medicare) sales tax that begins in in 2013?

Monday, November 29, 2010

The 3.8% real estate gains sales tax is applicable for real estate transactions where the gain is over $250k. The gain up to and including $250k is not subject to the new tax. This tax is not the same as the capital gains tax where the 1031 Exchange is meant to “defer” your capital gains [...]

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I’d just converted my house into a rental home. How long before I can 1031 Exchange it?

Monday, November 29, 2010

In order for your primary residence to be considered for 1031 Exchange treatment it must considered as “Real Estate Held for Business” use and not “Real Estate held for personal use”. We recommend that you should be collecting rents on the property for at least 2 tax periods so that you can prove to the [...]

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How do I pay Realtor commissions if I 1031 exchange one property for another?

Saturday, November 27, 2010

Just like most property sales that include a closing agent, whether it be a Title/Escrow Company, Attorney or CPA, the commissions that get paid to Realtors are considered part of the closing costs. When you execute a 1031 Exchange all of the fees that are incurred for the property sale including, the title insurance, deed, [...]

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Why does the Qualified Intermediary have to hold the proceeds from my 1031 Exchange? Why can’t my Title Escrow Company?

Saturday, November 27, 2010

The biggest issue here is to avoid “constructive receipt” of your proceeds, which is why you should NOT keep money or other property during the transaction. If you receive the entire cash proceeds from your 1031 Exchange or are in control of those funds in any way, you will not qualify for §1031 treatment.  You [...]

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Thinking about a 1031 Exchange but I need some help. Any ideas?

Friday, November 26, 2010

Get all the 1031 Exchange information you need from one source, http://www.realtyexchangers.com. Founded in 1989 the FIRST on the web in 1995, Realty Exchangers is THE source for 1031 Exchange Information. Launched in 1995, Our FREE 1031 Exchange Procedure Manual was first with the best content for understanding and executing an IRS Section 1031 Exchange. [...]

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What property does not qualify for 1031 Exchange?

Friday, November 26, 2010

Often, when discussing 1031 Exchange Qualified Properties, it is better to discuss properties that DO NOT qualify for 1031 Exchange treatment. This is important because if you transfer property that does not qualify for 1031 Exchange it will be treated as a regular sale of the property and subject to capital gains. The following types [...]

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