INVESTING:
“Hi Gary. My wife and I own a condo in U.C. and want to sell it and buy a four-unit property. I dont know much about 1031 exchanges, but I do know if you do it right, you dont have to pay any taxes. Can you give me the basics on exchanges? ”
***ANSWER:
An IRS Code 1031 tax-deferred exchange is typically a 3-way delayed exchange, often called a “Starker Exchange”. Don’t let all the lingo confuse you–exchanges are quite simple if you use an agent who is familiar with them.
Here are the very basic steps:
1. You arrange for the sale of your property.
2. At closing, your sales proceeds go to what’s called a “Qualified Intermediary”, which is a 3rd-party company.
3. You “identify” a property(s) to buy within 45 days of closing your sale.
4. You close within 180 days of closing your sale.
I’ve personally done several exchanges for myself and handled hundreds for clients. Id suggest you take advantage of this weeks free 1031 Exchange DVD offer.
If you have questions, want more info, or wish to do an exchange, call me at (858)457-KENT and I’ll be glad to help…
