Daytona Beach Real Estate | Daytona Beach Homes For Sale | Daytona 1031 Exchanges
The 1031 Exchange
A 1031 exchange is a method also known as a tax deferred exchange.
A 1031 tax deferral involves selling a qualified property that a taxpayer has held as an investment and then proceeding to acquire another qualified property within a certain timeframe required by the IRS.
To qualify for 1031 "like kind" property exchange the process has to be done in accordance with the rules, regulations set forth in Section 1031 of the Internal Revenue code.
Here are few basic rules of a 1031 exchange
The 1031 exchange IRS rule states that the properties involved in the transaction must be "Like Kind" and both properties must be held for a productive purpose in business or trade and as an investment.
The capital gains are tax deferred not "tax free"
You must abide by two time lines.
- Identification period -The party must identify the replacement or like kind 1031 exchange 45 days from the close of escrow on the relinquishing property. You can select more than one property.
- Exchange period you must complete your 1031 exchange which includes receiving title to your like kind replacement properties no later than 180 days after closing of escrow for relinquished properties or the due date of your Federal tax return for the year that the relinquished property was sold.
Qualified Intermediary
A Qualified Intermediary (QI) is an independent and professional facilitator who must be used to facilitate the 1031 transaction. He handles the funds from the original sale and holds the funds until they are needed to purchase the new exchange property.
How can we as Realtors assist you with your 1031 exchange?
We can recommend a 1031 exchange Qualified Intermediary to walk you through the 1031 process. Your Qualified Intermediary will ensure that you are in compliance with the tax codes and regulations.
We will work with your consultants and Qualified Intermediary during the 1031 exchange process.
With property prices down, we can help identify a larger home or investment property using your 1031 exchange.
If you are considering selling your investment property and buying a like-kind exchange property contact Marty at 386-316-5968 or Mike 386-316-5967.
If you would like to learn more about the 1031 exchange we will be happy to explain the process to you so you are more familiar with the process. However, we recommend that you speak with your CPA or tax advisor to be certain that a 1031 Exchange is in your best interest.
It is important to consult professionals when buying or selling investment properties.
Take advantage of a 1031 exchange with the lower prices of homes, multifamily units, commercial properties and more in the Daytona Beach real estate market.
Contact Team Gagliardi now for more information about Port Orange Real Estate and Daytona Beach Condos. Marty Gagliardi 386-316-5968 - Michael Gagliardi 386-316-5967 or Heidi Gagliardi 386-290-6842. We are ready to assist you!
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