1031Exch Question (by JamesD [CO]) Aug 15, 2015 11:44 AM|
1031Exch Question (by Robert J [CA]) Aug 15, 2015 12:57 PM
1031Exch Question (by Beth [WI]) Aug 15, 2015 6:06 PM
1031Exch Question (by JamesD [CO]) Aug 17, 2015 4:34 PM
1031Exch Question (by Lynda [TX]) Aug 17, 2015 5:07 PM
1031Exch Question (by Beth [WI]) Aug 17, 2015 7:01 PM
1031Exch Question (by BillS [CO]) Aug 18, 2015 10:14 AM
1031Exch Question (by JamesD [CO]) Posted on: Aug 15, 2015 11:44 AM
We have a high-end property that we want to sell and get into something more profitable. Would like to consider a 1031Exchange deal. Will the Exchange rules allow us to buy a less expensive property with all the proceeds from the sale, or does the new property have to be of equal or higher value under the 1031 rules?!
1031Exch Question (by Robert J [CA]) Posted on: Aug 15, 2015 12:57 PM
Your exchange property can be less expensive but then you will have to pay either Boot or Mortgage Boot. Boot being tax on the difference. Depending on if you have a mortgage, you may have to pay taxes on the recapture at 25%, instead of mortgage boot at 15% (long term capital tax rate).
1031Exch Question (by Beth [WI]) Posted on: Aug 15, 2015 6:06 PM
At my last 1031 I downsized slightly. I think I purchased about 50K less than I sold for. So, I ended up paying some capital gains and some recapture tax just as Robert mentioned. But it didn't end up being too bad because it was "proportional". That's my wording. What I mean is that I didn't have to pay recapture tax on the entire 50k just about on 20k. Got rid of more debt and am making MORE money after downsizing. :) --24.181.xxx.xxx
1031Exch Question (by JamesD [CO]) Posted on: Aug 17, 2015 4:34 PM
Could we buy two new properties that together are worth same or more than the sale price of the original property? In that case, would we be able to avoid the Boot/Mortgage Boot/Recapture taxes? --73.203.x.xxx
1031Exch Question (by Lynda [TX]) Posted on: Aug 17, 2015 5:07 PM
I looked into doing a 1031 exchange a few years ago. One of the best places for good info is: Starkerexchange.com
I found out that you could not only could you exchange actual physical properties--but you could also exchange a physical property for any "like" real estate operations--like an REIT. I just could never find an REIT that I felt comfortable putting 100K into. But it sure would have been nice to get the quarterly dividends without the tenants and toilets, etc.
I still have that home, and at $810/mo x 3= $2430/quarter, I'm still ahead. --99.158.xxx.xxx
1031Exch Question (by Beth [WI]) Posted on: Aug 17, 2015 7:01 PM
James, yes you can buy 2. I did exactly that after selling one building. --66.87.xx.xxx
1031Exch Question (by BillS [CO]) Posted on: Aug 18, 2015 10:14 AM
JamesD - I am in the midst of a 1031 right now. Sold one and due to a series of mishaps am using the proceeds for down payments on two. You are allowed to identify a maximum of 3 properties or up to 2x the value of the property sold. --73.34.xxx.xx