By Jerry Feeney Esq. and Daniel Mendoza Qualified vs Unqualified Closing Costs One of the most common mistakes taxpayers make in a 1031 exchange is using exchange proceeds to pay unqualified closing costs. This minefield can cause unexpected tax bills for even the most careful exchanger. Let’s take a look at what can happen. Suppose
Common Pitfalls with Identifying Replacement Properties/Canceling Exchanges Learn about the key deadlines and rules for modifying property lists in 1031 exchanges, and what happens if you miss them. When executing a forward/delayed 1031 exchange there are 2 major deadlines: (1) exchanger has 45 days to identify to the qualified intermediary replacement properties, and (2) 180
The 1031 Adviser: Converting 1031 Replacement Property into a Principal Residence It’s not uncommon for an investor to convert a property held for business, trade or investment into a principal residence. Change in investment potential of the property, or a desire to get out of the landlord business, might make the investor decide to
Second Homes and the 1031 Exchange A 1031 exchange can be used to defer capital gain and depreciation recapture taxes on the sale of property held for business, trade or investment. The guidelines for a successful exchange must be followed carefully or the IRS may disallow the exchange. I am often asked whether a property
What is a tax deferred 1031 exchange? A deferred 1031 exchange is a tax-savvy strategy provided by the Internal Revenue Code, that allows real estate investors to defer capital gains and depreciation recapture taxes when sell and the buy investment property. This can be a valuable and powerful tool for investors looking to accumulate wealth,