oes the stress of monthly return on their equity without
rent collection and after having nearly 30% of their
hour plumbing problems make profits swallowed by capital
you feel like a performing seal gains tax.
at the circus? You're trying to
keep a spinning beach ball Under the regulations of the
balanced on your nose, at the 1031/TIC Exchange program, an
same time that you're wildly investment property owner can
clapping your flippers together "exchange" their current
hoping to please an commercial property for a
unappreciative audience. "like-kind" investment property
of equal or greater value,
Does thinking about selling your deferring the payment of capital
investment property make you feel gains taxes and maximizing their
like Bozo the clown? Having to profits.
paint on a happy smiley face when
thinking about the large A relatively new tax program, the
percentage of your profits that 1031/TIC Exchange program wasn't
you're going to lose to capital sanctioned by the IRS until 2002.
gains tax makes you frown? Many commercial property owners
who might qualify for the 1031
There is a way to move on and deferred tax program don't know
leave the circus behind. that it's a viable option
available to them.
It's called a 1031/Tenant In
Common (TIC) Exchange. This kind Qualified investment property
of deferred capital gains tax owners will discover that there
investment is an attractive are other benefits to the
option for owners of investment 1031/TIC Tax Deferred Exchange
property who are looking to get a program. You'll have a monthly
income stream from your your new commercial investment is
investment property, without the well maintained and serviced by a
hassles that go along with being reliable property management
a hands-on landlord. And your new company with a great track record
1031/TIC Exchange investment and years of experience.
property will pass directly to
your heirs at the stepped up
basis (according to current tax The 1031/TIC Exchange transaction
law). Your beneficiaries won't can be a bit complicated for the
have to pay capital gains tax. novice. Attempting it without the
guidance of a professional
There are three very important financial advisor, who
elements of the 1031/TIC deferred specializes in this kind of
tax transaction that every deferred capital gains tax
investment property owner should program, could lead to some
know: unexpected and unsatisfactory
results.
" You'll need an unbiased third
party qualified intermediary, You could find yourself involved
perhaps a lawyer or qualified with a 1031/TIC sponsor company
CPA, who will handle all of the that handles poor quality real
paperwork and make sure the IRS estate investments that may need
guidelines are followed. work have little appreciation
potential. They may have high
" You'll need to work with a tenant turn-over and require
quality 1031 Sponsor Company with constant maintenance. You'll need
a continuous inventory of grade A to make sure the 1031/TIC sponsor
commercial real estate. company you're working with
handles only quality real estate.
" You'll need to make sure that This is often high end office
space leased to long-term must be adhered to when you're
corporate clients. making this kind of property
exchange. If they are not met,
You also want to avoid working you'll find yourself paying those
with an unreliable property capital taxes out of your own
management company. Poorly pocket, despite your good
managed properties make owners of intentions.
1031/TIC investment properties
the targets of lawsuits from There is a way for you to get out
unhappy tenants, and may lead to of the circus ring and into the
eventual loss of equity as the audience enjoying the
building depreciates instead of performance.
increasing in value.
For investment property owners
You can't use a family attorney who are interested in the
or CPA to generate the paperwork 1031/TIC Exchange program,
necessary for the 1031/TIC working with an experienced
exchange. You need to find an financial advisor is the only way
unbiased third party who is to avoid all of the pitfalls of
experienced with this capital this complicated transaction.
gains tax deferment transaction.
There are many deadlines that
About the Author:
How much would you pay to save thousands of dollars in capital gains tax? Learn about your options in a free information packed teleclass. Sign up right now at http://www.savegainstax.com or email Paula Straub at askpaula@savegainstax.com
Source: www.isnare.com
