Section 1031 exchange proceeds must be invested in direct property ownership, not in a real estate fund structured as a partnership. Delaware Statutory Trusts can be structured to allow Section 1031 investors to invest in the same property as a real estate fund, but to qualify for Section 1031 exchange, DSTS must comply with signfiicant operational restrictions and remove the flexibility that generally exists with a real estate fund.
Read MoreSection 1031 exchange proceeds must be invested in direct property ownership, not in a real estate fund structured as a partnership. Although a TIC structure is a possible alternative, due to a combination of tax law and mortgage lender requirements, TICs are an alternative only under limited circumstances require careful structuring to comply with both tax and securities laws.
Read MoreThe American Families Plan proposes ending the ability for investors to use Section 1031 to defer taxes on gains greater than $500,000. Business owners and real estate investors can take action now to minimize the tax impact of this and other proposed tax changes.
Read MoreThe real estate investment strategy of doing successive Section 1031 exchanges and planning for a stepped up basis upon death may no longer be viable if the Biden tax plan becomes law.
Read MoreRevenue Procedure 2020-34 provides a safe harbor for loan forbearances, lease modifications, and additional capital contributions needed due to the COVID-19 pandemic.
Read MoreMy son started at age three playing a 1/32 size violin, which with an eight-inch body looked more like a toy than a violin. A few months ago, my son traded in his ¾ size violin for a 7/8 size instrument, which is valued at 20 times the price we paid for that original 1/32 size violin nearly nine years before. When we made the most recent violin purchase, I realized how our “investment” in violins is like real estate investment.
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