 1031 exchange (by Victoria [TX]) Jul 5, 2015 9:06 AM
 1031 exchange (by tryan [MA]) Jul 5, 2015 12:09 PM
1031 exchange (by Robert J [CA]) Jul 5, 2015 1:58 PM
1031 exchange (by #22 [MO]) Jul 5, 2015 9:42 PM
1031 exchange (by Marv [IL]) Jul 6, 2015 5:29 AM
1031 exchange (by Jen Z [CT]) Jul 7, 2015 9:36 AM
1031 exchange (by Victoria [TX]) Posted on: Jul 5, 2015 9:06 AM
Message:
State Specific Question About: TEXAS (TX)
I'm considering selling a Single Family Home we've been using as a rental. I'm not sure if it would be better to just sell it and pay capital gains (we'll probably make around $20-30K on the sale) or try for a 1031 exchange. If I did that I would like to purchase a duplex. However, if I did that do I have to rent both sides? I am wanting to rent one side and retain the other for personal use.
Thanks --107.195.xx.xxx |
1031 exchange (by tryan [MA]) Posted on: Jul 5, 2015 12:09 PM
Message:
As a disclaimer ... I am not an accountant or lawyer.
But I did do a 1031 exchange selling a duplex and trading for raw land. Lots of flexability provided it's real estate for real estate .... can't really see a problem with what your doing (it is a RENTAL after all) --24.147.xx.xxx |
1031 exchange (by Robert J [CA]) Posted on: Jul 5, 2015 1:58 PM
Message:
I've done many 1031 exchanges going back from 1990 through 2007. In my area, Los Angeles, houses sold during that period from $250,000 to $600,000. The Capital gains tax, State and Federal, would have cost me between $40,000 and $140,000.
Speaking about saving between $40,000 and $140,000 in capital gains tax, it's a no brainer, do the exchange.
The only times I didn't do an exchange and paid the taxes, is before the capital gains rate was raised to 20% instead of 15% and before there was an Obama Care tax of 3.8%. This saved me in paying higher taxes, but still cost me big bucks. But when the taxes are peanuts like in your case, either way is okay. --173.55.xxx.xx |
1031 exchange (by #22 [MO]) Posted on: Jul 5, 2015 9:42 PM
Message:
Ask your accountant what your gain is. Ask for their opinion. If you wish to purchase more re, it would be foolish to not do a 1031 in my opinion. --69.136.xxx.xxx |
1031 exchange (by Marv [IL]) Posted on: Jul 6, 2015 5:29 AM
Message:
You would have to rent both sides...for a reasonable amount of time. The last I knew, no time limit is listed in the code. --173.15.xx.xxx |
1031 exchange (by Jen Z [CT]) Posted on: Jul 7, 2015 9:36 AM
Message:
I'm not an accountant either, but you should definitely check what you would make. If you were depreciating it as a rental on your taxes, you have to pay taxes on that depreciation. In addition, the capital gains taxes would be the sale price, minus your purchase price and any major improvements (not repairs).
Here is a tidbit on the depreciation recapture tax: The tax rate on recaptured deprecation is 25 percent. The best way to understand how it works is through an example. Consider a rental property that you bought 15 years ago for $250,000 and just sold for $350,000. Your analysis showed that $180,000 of the value was in the depreciable buillding and $70,000 was in non-depreciable land. You would have a $100,000 capital gain on the difference between the original purchase price and the selling price, taxable at 15 percent in the 2012 tax year.
In addition, the $6,545 per year depreciation that you claimed based on the asset's 27.5 year life, which adds up to $98,175, is taxable at 25 percent as recapture. This leads to a total tax bill on the sale of $39,544, based on $15,000 in gains tax and $24,544 in recapture tax.
homeguides.sfgate.com/paying-back-depreciation-rental-property-42080.html
--209.255.xxx.xxx |
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