1031 Exchanges and Tenant In Common Investing Gaining Ground
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There is more and more interest in 1031 and Tenant In Common investing these days as people are selling property in areas with very high appreciations and looking to avoid income tax while getting the money working productively. The Baltimore Chronicle has a good article on the process and some of the benefits of a 1031 exchange.
Tenant-in Common is a form of ownership whereby two or more individuals own a partial share of a whole piece of property. Each co-owner receives his or her portion of net income, tax benefits and appreciation. TIC investments are created by various sponsors who acquire the property and package it for sale to multiple investors who will each own a fractional interest. The typical TIC offering is a large institutional property such as an office building or luxury apartment complex.
A 1031 exchange is usually a three-way delayed exchange in which an intermediary is used to facilitate the transaction. There are four basic steps:
- The seller arranges for the sale of property and includes exchange language in the contract.
- At closing, sales proceeds go to a Qualified Intermediary for a 1031 exchange.
- The seller must identify potential exchange properties within 45 days of the closing.
- The seller must complete the 1031 exchange within 180 days of closing.
A successful exchange can result in the taxpayer being able to utilize 100% of the proceeds from the sale of property to purchase a new property, thus deferring capital gains. By doing this, real estate owners can accomplish a number of objectives: diversification, improved cash flow, greater leverage, geographic relocation, or property consolidation. via the BaltimoreChronicle.com.
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It seems there are numbers posted about how much it could cost the US in home sales from people holding ...
The only people holding off will be those that are financially secure and can manage to hold off. How ...
What an awesome way to generate traffic for a story. Were they trying to time that for Sweeps Week? ...
That's awful. I wonder if using that tactic , if a building can be sold or used as collateral. ...
Good point about people possibly holding off now. The 4.5 percent interest rate could be a self-fulfilling prophecy. 
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I will say that had I never been to that site and seen Dean's many deals that he documented and ...
Great Real Estate
post ... very interesting. 
