Let's talk about the IRC loophole known as the 1031 exchange.  First let's explore what a 1031 Exchange can do for you  Can you benefit from the IRC 1031 Exchange?  You can make your own decision after getting the low down.  Let's explore.


What is an exchange?  1031 exchange at www.1031gateway.com refers to section 1031 of the IRC.  Within the time guidelines among others, a properly structured 1031 Exchange lets investors defer capital gains when reinvesting in a second property after the sale of another.


Let's try to comprehend the power of the protection the 1031 exchange offers a property owner.


An investor has property A for $100,000 in capital gains from the sale, $35,000 in combined taxes, leaving only $65,000 to reinvest.


Assuming industry average of twenty five percent down with loan to value ratios of seventy five percent, would limit the buying potential of property B to only $260,000.


If that seller chooses to exchange, he or she would then be permitted to reinvest the entire $100,000, assuming similar loan-to-value ratios, that would allow the investor to purchase a new property of up to $400,000. To read more about 1031 exchange, you may visit https://www.youtube.com/watch?v=6LIAEfAIwPg.


Protection from capital gains is the hallmark of 1031 Exchanges.  Make sure you or your financial consultant understands all the terminology in 1031 exchanges.  Explore the benefits of a 1031 exchange, use a free online capital gains calculator to see if it's right for you.


Much due diligence is necessary prior to executing an exchange with a capital gains tax calculator.  To determine the viability of a 1031 exchange, consult with a pro.


Time limits are in play when it comes to 1031 exchanges, know your timetable or it could cost you.  A person who executes a 1031 has a max of 180 days or tax filing day to purchase the second property.  Executing a 1031 exchange right after you filed your taxes is recommended, allowing you the most time available to get property B.  Financial advisors, tax accountants and real estate professionals should be able to assist you with your 1031 exchange.  Speak with other investors for recommendations of a professional in your area that has experience with 1031 exchanges.  Good luck with your 1031 Exchange.  Know the ins and outs of the real estate game, and take advantage of the benefits a program like 1031 exchange provides.  Getting this process right is crucial, don't rush your learning curve, get help if you need it and use the money saved to buy bigger and better properties.



The IRC's 1031 exchange allows investors to maximize their investment potential and expand their portfolio.