The Capital Gains Blog

Posts Tagged ‘_1031_exchange’

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The Commercial Observer: Last year, Eastern expanded its loan sales group. How has the response been? Mr. Hauspurg: We actually started in 2005, which was a bit early, but we could see what was coming. The values were getting out of hand and we knew at some point the banks were going to become big players. It took a lot longer than we thought, and loan sales, even in 2009, there wasn’t a lot…

Alamogordo Real Estate Home for Sale. $289500 5.00bd/2.25ba. – NELSON, MIKE of alamonelsonteam.com

QUICK POLL

What Financing? Those who follow Chinese astrology know that this is the Year of the Tiger, the proverbial king of the jungle admired for its vivid stripes that symbolize the balanced forces of yin and yang.

Long-term, passive real estate investments are typically sought out by those looking to plan for their heirs. Normally, the principal owner is a sophisticated real estate investor who wants to simplify asset holdings for the future.

Moreover, beneficiaries may be better served by owning an asset that provides a steady income stream along with the benefits of owning real estate. But estate planning can be complicated, and the transfer of assets to an estate must be handled by a qualified professional who is familiar with state and federal tax laws.

“Those looking for safer assets for their beneficiaries should be cognizant of various factors,” says Benjamin Hanan, shareholder at Sarasota law firm Abel Band Chartered. “Using net leased investments as an estate planning tool can be highly beneficial to both the investor and their beneficiaries.”

Should a particular investor purchase and maintain their net leased investment until death, the investor’s estate will receive a step-up in basis to its fair market value as of the date of the investor’s death, thereby eliminating all of the deferred income tax on that investment. Thereafter, the investor’s beneficiaries receive the following benefits: a real estate investment; an income stream; and an asset in which they possess a relatively high basis such that if they sell the asset in the future, they can minimize the taxes paid in connection with a sale (or, if properly structured, such taxes can be deferred through a 1031 exchange).

However, the passive nature of the investment is always seen as a benefit to the heir(s). Typically, this ideology is taken because the beneficiaries are not as savvy as the investor and, therefore, the burden of management-intensive real estate is perceived as a secondary or tertiary option for the investor. When planning an investor’s estate, the net lease investment is typically seen as a sign of thoughtfulness and consideration for the benefit of future generations.

John Maceovsky, senior manager of Clearwater CPA firm Kirkland Russ Murphy & Tapp PA, has seen clients acquire large portfolios of real estate assets over a lifetime who are faced with the decision on how to pass on their success with minimal financial impact. Maceovsky stated that “utilizing net leased investments in conjunction with family limited partnerships and a suitable gifting strategy, an individual can transfer appreciated assets to the next generation.”

While net lease investments have been an option for decades, they have only been in the forefront of the investment community over the last dozen years. During that time, few have deemed it a viable asset class for estate planning advisors and professionals. By not only looking at the intrinsic real estate value of an asset or the creditworthiness of a tenant, individual investors are looking beyond their years in an effort mitigate as much effort as possible for their legatees.

Renal Co. Completes Second Sale-Leaseback

RAI II LLC, a local affiliate of Nashville-based Renal Advantage Inc., has sold its renal clinic at 1333-1341 Poplar Ave. in Midtown for $2.6 million ….

The 1031 Tax Deferred Exchange

Question: Do I have to pay estimated taxes on my capital gain and by when?

I am currently closing on the sale of my rental property and will have to pay capital gains because I am not doing a 1031 exchange. Do I have to pay estimated taxes on the gain or can I bank the money until tax day and pay it then? Could I just pay a portion of it now and the rest later? What forms do I use to estimate the tax and pay it?

Answer: If you are just looking to avoid payiong underpayment penalties, then as long as you have withheld / made estimated payments that will AT LEAST cover the tax liability on you 2005 tax return, then no estimates are needed. Rule is must have on deposit with gov’t either 100% of prior years tax or 90% of current year.

If you are looking to avoid paying anything, then you will need to do a quick calculation of your tax liability for 2006 and pay the difference.

I suggest you just avoid the penalties and bank it.

What the new year and new decade will hold for housing market

Every year at this time, I peer into my crystal ball and attempt to determine the future of housing for the new year, if not the new decade.

The 1031 Exchange: Your Best Investment

Triple Net Lease Brokers USA, http://NNNBrokersUSA.com, Offers Bonded & Insured Free …

Triple Net Lease Brokers USA, http://NNNBrokersUSA.com, Offers Bonded & Insured Qualified Intermediary Service for Free to all 1031 Exchange Buyers Represented by NNN Brokers USA. As Clients of NNN Brokers USA, 1031 Exchange Buyers will Benefit from the Safest 1031 Exchange Qualified Intermediary (QI) in the Industry and Receive the Most Competitive Interest Rates on …

Drew Miles on avoiding tax scams and using a reliable tax strategy – tax deferred exchange