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Rainmaker
5,583,278
Barbara Todaro
RE/MAX Executive Realty - Happily Retired - Franklin, MA
Previously Affiliated with The Todaro Team

nothing is "simple" with a 1031 exchange.... 

May 25, 2017 10:38 AM
Rainmaker
809,258
Kasey & John Boles
Jon Gosche Real Estate, LLC - BoiseMeridianRealEstate.com - Boise, ID
Boise & Meridian, ID Ada/Canyon/Gem/Boise Counties

Investor sells a property, can't touch the money, has a qualified intermediary hold the money while they look for a replacement property or properties to spend the funds on, they have 45 days to identify replacement propert(ies) and 180 days to close. If they follow the laws and do things properly they sell a property, buy a property and defer paying capital gains taxes on it.  Here is a good, concise link for more info http://www.pioneer1031.com/exchanges/delayed-exchange.php.  Find a 1031 company/attorney in your area/state for more info. -Kasey

May 25, 2017 10:31 AM
Ambassador
2,684,009
Fred Griffin Florida Real Estate
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

  Internal Revenue Code Section 1031 cannot be "simplified".  You are dealing with the Internal Revenue Service. 

  Find a good local qualified Intermediary to send your clients to (ask your Title Company or Title Attorney for the name of someone in your area).  Let that qualified Intermediary explain it to your investor clients. 

 

 

May 25, 2017 10:30 AM
Rainmaker
5,772,575
Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy

Brian,

There is someone in your market that does them.  Contact them, buy them lunch and have them explain it.  That is how we did it.  To explain it would take several pages.  You will learn more face to face.  A

May 25, 2017 10:29 AM
Ambassador
6,393,404
Bob Crane
Woodland Management Service / Woodland Real Estate, KW Diversified - Stevens Point, WI
Forestland Experts! 715-204-9671

I think that Ken Jones has a post of two that simplifies this.  But if I were setting one up I would go to a pro for the first one or more.

May 25, 2017 10:19 AM
Ambassador
3,345,091
Kathleen Daniels, Probate & Trust Specialist
KD Realty - 408.972.1822 - San Jose, CA
Probate Real Estate Services

Simplify?

I suggest you google it and get an education on how 1031 exchanges work. 

May 25, 2017 05:26 PM
Rainmaker
2,220,323
Anthony Acosta - ALLATLANTAcondos.com
Harry Norman, REALTORS® - Atlanta, GA
Associate Broker

There is nothing simple about 1031 exchange.  

May 25, 2017 05:15 PM
Rainmaker
1,239,901
Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

tax deferment...

May 25, 2017 05:14 PM
Rainmaker
5,005,642
Dorie Dillard Austin TX
Coldwell Banker Realty ~ 512.750.6899 - Austin, TX
NW Austin ~ Canyon Creek and Spicewood/Balcones

Thank you Fred Griffin ..good answer!

May 25, 2017 05:11 PM
Ambassador
5,049,158
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

It can get kinda complicated and there are some very specific IRS rules. I would hook up with a 1031 exchange company to get the scoop

May 25, 2017 05:04 PM
Rainmaker
3,988,007
Debbie Reynolds, C21 Platinum Properties
Platinum Properties- (931)771-9070 - Clarksville, TN
The Dedicated Clarksville TN Realtor-(931)320-6730

I suggest you find a local attorney or escrow agent that will sit down with you and explain the mechanics of 1031. It will not work in every situation or for everyone. There are certain time constraints. property types and reinvestment criteria that must be met. It has to be exact to qualify.

May 25, 2017 04:51 PM
Rainmaker
613,494
Eve Alexander
Buyers Broker of Florida - Tampa, FL
Exclusively Representing ONLY Tampa Home Buyers

I love 1031 exchange because the buyer is on a time crunch and is not going to drive you crazy being picky.

This is ONLY for investors who want to delay paying taxes on the profit of the investment property sale.  So they take the profit from the property sale and re-invest it into another investment property. (this is not for owner occupant property)

They have 45 days to pick a replacement property(s) and 6 months to close on it.  They can also buy more than one property with the profit money.  IF the investor wants to pocket some of the money instead of re-investing in another property, they simple pay taxes on what they keep.

Investor can either pay cash for the new property and/or get a loan.  If they had a loan on the first property, in order not to pay taxes they need to use all the profit money and a loan equal to (or more than) the last property.  (or they get taxed on the difference).

Simple answer is that it is a way for an investor to keep rolling the profit on an investment sale into a more expensive property while defering paying the taxes.

Eventually when they do sell outright, they will need to pay taxes.

Eve

PS: It is not difficult.  Once you do one, it is easy.

May 25, 2017 12:06 PM
Rainmaker
1,231,853
Mary Yonkers
Alan Kells School of Real Estate/Howard Hanna Real Estate - Erie, PA
Erie/PA Real Estate Instructor

Impossible to simplify as others have said

May 25, 2017 05:48 PM
Rainmaker
4,160,412
John Pusa
Glendale, CA

Brian Burkhalter Many good answers already.

May 25, 2017 04:24 PM
Rainmaker
921,504
Annette Lawrence , Palm Harbor, FL 727-420-4041
ReMax Realtec Group - Palm Harbor, FL
Making FLORIDA Real Estate EZ

That is like asking someone to explain what potatoes taste like.

Do one.

Everything becomes simple when you know the answers.

You learn by doing.

Eat a potatoe or do a 1031, then it all becomes more simple.

Just do it already. You have a broker! What are you paying your broker for?

 

May 25, 2017 02:51 PM
Rainmaker
1,712,676
Joe Pryor
The Virtual Real Estate Team - Oklahoma City, OK
REALTOR® - Oklahoma Investment Properties

You need to take a class because you can't simplify it.

May 25, 2017 12:40 PM
Rainmaker
2,781,173
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

The best source for this is google or the pro...everything else is an opinion

May 25, 2017 10:43 AM
Rainmaker
4,882,355
Richard Weeks
Dallas, TX
REALTOR®, Broker

I have a 4 page document prepared by a QI company.  Give me your email and I will send you a copy.

May 25, 2017 10:38 AM
Rainer
3,770
Brian Burkhalter
N/A - Draper, UT
Here to learn.

I know their are post and videos i looked at them. I need it in everyday english and if you cant be respectful please dont respond.

May 25, 2017 10:16 AM
Rainmaker
4,319,419
Praful Thakkar
LAER Realty Partners - Andover, MA
Andover, MA: Andover Luxury Homes For Sale

Brian Burkhalter - the best person to answer this would be Ken Jones ...

May 25, 2017 09:57 PM
Ambassador
5,230,062
Debe Maxwell, CRS
Savvy + Company (704) 491-3310 - Charlotte, NC
The RIGHT CHARLOTTE REALTOR!

Great explanation, Kasey & John Boles!  I just Closed on one and we were in just under the 45-day wire!

May 25, 2017 08:39 PM
Rainmaker
3,986,258
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

1031 is not a big deal...hire a competent company to work with and it can be very simple

May 25, 2017 08:05 PM
Rainmaker
1,502,998
Ryan Huggins - Thousand Oaks, CA
https://HugginsHomes.com - Thousand Oaks, CA
Residential Real Estate and Investment Properties

Simplified version: Sell one investment property, use the proceeds to purchase X investments.

Example: Sell one rental property and buy two more, or a commercial building, or stocks, or an offshore oil rig, or a company, or .... so long as it is a qualified investment and the 1031 administrator signs off on it.

May 27, 2017 04:59 PM
Rainmaker
5,104,931
Nina Hollander, Broker
Coldwell Banker Realty - Charlotte, NC
Your Greater Charlotte Realtor

This can be an entire chapter in a book. If you google the concept, you'll get lots of answers. Why don't you do a bit of research and write a blog post about what you learned that could help others like yourself.

May 27, 2017 06:29 AM
Rainmaker
7,836,134
Roy Kelley
Retired - Gaithersburg, MD

Read the IRS regulations. You need to have a good lawyer and a CPA on your team.

May 26, 2017 07:24 AM
Rainmaker
1,157,785
FN LN
Toronto, ON

Tax issues cannot be simplified.  There are many issues to consider.

May 26, 2017 07:19 AM
Rainmaker
1,466,207
Michael Setunsky
Woodbridge, VA
Your Commercial Real Estate Link to Northern VA

Brian Burkhalter There is no simple answer. You really have to know what you are doing. An intermediary is a must. Kasey & John Boles has a good answer.

May 26, 2017 06:31 AM
Rainmaker
1,617,916
Harry F. D'Elia III
WEDO Real Estate and Beyond, LLC - Phoenix, AZ
Investor , Mentor, GRI, Radio, CIPS, REOs, ABR

ask the broker

May 26, 2017 06:30 AM
Rainmaker
1,725,996
Sandy Padula & Norm Padula, JD, GRI
HomeSmart Realty West & Florida Realty Investments - , CA
Presence, Persistence & Perseverance

As others have noted already and something that, if you have never done, you should rely on the direction of your managing broker to assist you through the process. To do less is an Ethics Violation.

May 26, 2017 05:47 AM
Rainmaker
5,216,398
Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Contact a local qualified intermediary for a tutorial session. Use them to make sure it goes smoothly!

May 26, 2017 05:44 AM
Rainmaker
4,800,082
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

I don't know how to simplify a complex subject.

May 26, 2017 05:10 AM
Rainmaker
3,071,489
Tony and Suzanne Marriott, Associate Brokers
Serving the Greater Phoenix and Scottsdale Metropolitan Area - Scottsdale, AZ
Haven Express @ Keller Williams Arizona Realty

Barbara Todaro nailed this one!

May 26, 2017 05:06 AM
Rainmaker
4,434,127
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

It is not simple. 

May 26, 2017 03:27 AM
Rainmaker
1,543,672
Thomas J. Nelson, REALTOR ® e-Pro CRS RCS-D Vets
Big Block Realty 858.232.8722 - La Jolla, CA
CEO of Vision Drive Realty - Coastal San Diego

 sell tax free when you exchange the property for another like or better property or many properties equal to or better than the gain.

May 25, 2017 09:02 PM