 1031 exchange/ gifting (by Jenny [IA]) Sep 12, 2017 11:26 AM
 1031 exchange/ gifting (by Landlord ofthe Flies [TX]) Sep 12, 2017 1:07 PM
1031 exchange/ gifting (by BRAD 20,000 [IN]) Sep 12, 2017 2:10 PM
1031 exchange/ gifting (by Oregon Woodsmoke [OR]) Sep 13, 2017 5:21 AM
1031 exchange/ gifting (by Emily [TX]) Sep 13, 2017 8:51 AM
1031 exchange/ gifting (by Landlord ofthe Flies [TX]) Sep 13, 2017 12:07 PM
1031 exchange/ gifting (by Jenny [IA]) Posted on: Sep 12, 2017 11:26 AM
Message:
State Specific Question About: IOWA (IA)
In state of Iowa.
Parents are selling property with cap. gain at $255,000.
Allotting sister to use $190,000 for personal investments, wanting remaining $65,000 for them.
Parents exchange for property valued at $120,000 for sister's personal investment and remaining $135,000 is used to exchange for sister's house.
((Sister's house: Recent comp in area 2016 $140,000; Owes $90,000 on mortgage; Bought at $125,000))
Question 1) Cap gain taxed at 20% and sister's property would be taxed at state's sale tax (Iowa 7%)?
- Any other real estate tax to account for my sister to whom is selling her residential property?
- Sister's sales tax is applied to the amount gained from her sale ($50,000) or off the entire purchase price ($125,000) ?
After both properties are exchanged into parents' names, are they able to gift both properties to sister with their life-time gift (Properties valued totaling $255,000) all at the same time? --50.82.xxx.xxx |
1031 exchange/ gifting (by Landlord ofthe Flies [TX]) Posted on: Sep 12, 2017 1:07 PM
Message:
I don't know much about 1031 exchanges, but don't all the funds received from the sale need to be applied to a purchase immediately after? Sounds like they're selling and dividing the proceeds. Am I missing something?
Also don't forget about accounting for depreciation. --108.69.xxx.xxx |
1031 exchange/ gifting (by BRAD 20,000 [IN]) Posted on: Sep 12, 2017 2:10 PM
Message:
Jenny,
"Allotting sister to use $190,000 for personal investments" Nope.
"...wanting remaining $65,000 for them" as cash? Nope.
You need to talk to a CPA with lots of 1031 experience.
There are always tiny wrinkles which can easily ruin the entire benefit of tax sheltering.
As I understand 1031X, the OWNER may transfer the depreciation to a new property of same or greater value which THEY purchase. (with proper legal paperwork and legal custodian)
The depreciation is not recaptured until the owner sells and pays taxes at that time. 1031X only DELAYS when the taxes are paid.
If the owner dies the depreciation disappears at death and the property rolls into the estate at full current market value.
BRAD --68.50.xx.xxx |
1031 exchange/ gifting (by Oregon Woodsmoke [OR]) Posted on: Sep 13, 2017 5:21 AM
Message:
I can't follow what you are trying to do but 1031 exchange must be in the exact same name. Your parents can't 1031 property from their name into your sister's name.
I suggest you speak to either an accountant or to a licensed 1031 accommodator to get a clearer understanding of how it works. --70.199.xxx.xx |
1031 exchange/ gifting (by Emily [TX]) Posted on: Sep 13, 2017 8:51 AM
Message:
I'm having a hard time following this scenario, but the bottom line with 1031 exchange is that all the proceeds must be reinvested by the seller in property that is like-kind, within the exchange period, with appropriate identification within the ID period, with funds handled by a qualified intermediary and not touched by the seller. Seller will subsequently own the replacement property.
Any funds not used in this manner result in taxable gain to the seller. --155.201.xx.xxx |
1031 exchange/ gifting (by Landlord ofthe Flies [TX]) Posted on: Sep 13, 2017 12:07 PM
Message:
Besides, if you immediately cash out after doing the 1031, what's the point. You're taxed at the cash out point. What have you really saved by doing this? Also all monies have to be invested in the next property of greater value. --108.69.xxx.xxx |
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