Real Estate 1031 Exchange
A tax deferred Exchange
allows us to sell a piece of real estate rental property, trade or business
property, buy a new property with the gain or profit from that sale allowing
you to defer the taxes on the sale immediately. If you eventually sell the
new piece of property or real estate, you would owe taxes at that time.
Generally, all gains on sales of real estate are taxable, but there is an
exception where the property or real estate sold is traded or exchanged for
"like kind" property. The new property or real estate is seen as a
continuation of the original investment, so taxes are not due at the time of
the original property being sold.
One condition of the tax
deferred exchange is that the property or real estate you are going to
purchase or exchange for must be identified and the purchase closed within a
certain amount of time from the sale of the original property or real
estate. The property or real estate must be identified in writing, signed by
you, and delivered to the party assisting you with the exchange on or before
45 days from the date you sold the original property. Having correctly
complied with the identification process of the exchange, you have up to 180
days to complete the exchange. You may want to exchange for real estate in
another country at
PropertyWorld.com.
A tax-deferred exchange is a great way to keep your
investments growing by deferring the payment of taxes until a later date
thereby leveraging your money. You should always consult with a professional
on real estate exchange. This article is intended to offer you some basic
idea of the tax deferred real estate exchange. |
