Tax Free Exchanges (Turn your speaker on and click on any of following questions)

Need Immediate Help - Call 877-800-1040 or email


Tax Deferred Exchange Home Page

1.  Can I exchange for property of less value?

2.  Do I have to exchange for the same type of property?

3.  Does the exchanges have to been done simultaneously?

4.  What is a QI?

5.  Will IRS audit a tax free exchange?

6.  Can I change the name on the title of the new property?

Alternative to Investment Property
Jack Shea

New IRS Procedure on 1031 Tax Free Exchange Tenant-in-Common (TIC) Exchanges

Smaller investors can now invest in larger, professionally managed real estate and enjoy the benefits of tax shelter, growth, leverage and income without the thrill of management. An exchange is not necessary to purchase a TIC Property.

Funds from other sources can be used. The Internal Service issued Revenue Procedure 2002-22 on March 20, 2002 giving definitive guidelines for structuring tenant-in-common (TIC) exchanges. Now, taxpayers can exchange into a deeded share of a large, professionally managed property such as a Home Depot, Walgreen’s, Staples, etc. For several years sponsors have sold TIC investments as replacement properties in 1031 exchanges.

To qualify for a tax-free exchange, the replacement had to be like- kind. That is, investment real estate and not a partnership interest. All of the standard 1031 procedures are followed when investing in TIC properties, including the use of a qualified intermediary. The qualified intermediary prepares the required documents and escrows the sale funds until the taxpayer selects a tenant-in-common investment for a replacement property.

Many exchangors are now identifying three potential tenant-in-common projects, and then doing their due diligence research before closing on one or more properties within the 180 day period. Other taxpayers are identifying tenant-in-common investments as a back-up in the event they cannot find suitable replacement property. The recognition of tenant-in-common interests by the IRS present a new option for the average investor.

Previously, large investors have been using these as single buyers. Since the ruling, investment in TICs has doubled each year, to a projected $2 Billion for 2004. Many alternative tenant-in-common offerings are available.

A typical TIC investment is a $10 million dollar property with $3,500,000 of Investor’s cash and $6,500,000. of non-recourse debt. They include malls, office building, factories, apartment complexes, nursing homes and other types. The minimum investment is usually $100,000. and the return is about 8% cash on the cash invested. Due to the debt, the depreciation shelters much of the cash distribution.

Growth is projected at 2%, which would yield investors 6% on invested cash. In 2003 many TIC properties appreciated at 4% to 5%, yielding the owners a total return of about 24%. That is, 8% cash, 15% growth in equity, plus 1% buy down on the debt. They are planned for about a five-year term and at the sale, the investor may do another 1031 exchange into any real estate or tenant-in-common investment.

Contact Jack Shea at Keys Capital Inc. For information on available
TIC properties or with any other questions on the 1031 Tax Exchange. www.1031taxfreesale.com



Home
Latest Tax Free News
Tax Free Articles
Additional Resources
Want to Join the Moms?
Questions for CPA Moms?


Death & Taxes

We have Information to Help You with Either


Got Question for about a Tax Free Exchange?

IRS wants you to retire Financially Free!     We will answer your questions and give you options about how to become Financially Free when you retire

Tax answers/options when you sell your Home.      We will answer your questions about the tax free home sales and give you options on tax free exchanges

So, You got a letter from IRS?  We can help.    Letters from IRS are scary. We will answer your questions at no charge.

S-Corp, LLC, C-Corp, Partnership - Your Choice?    Selecting the correct Business Entity is confusing.  We will give you the tax options of each Business Entity.

How not to pay taxes when you sell income property.    We will explain how to do a tax free exchange & not pay taxes when you sell your income property.

Complete this form for Carl's Tax Tip on "How to get Tax Free Cash out a Tax Free Exchange"

E-mail Address: *
Your First Name *
Your City *
Your State *

* Required


More Information Less Taxes

Need Cash Quick?
   Same Day
   Next Day - 37,127 Locations
   Refund Anticipation Loan
   Earned Income Credit

Tax Deductions
     Day Care
     Moving
     Medical & Dental
     Education
     Educator Expense
     Divorce & Alimony
     Donating Car to Charity

Personal Finance
   Retire Buying Tax Liens
   Borrowing from your 401k
   Your Credit Report
   Credit Repair
   Your Social Security
   Social Secuity Disability
   Indentity Thief
   Reverse Mortgages
   Bankruptcy

Tax Preparation Specilities
 Truckers - Long Haul/Local

Where is my Refund?
   Electronic Filing

IRS want to give you:
    Earned Income Credit
    Adoption Credit

Business Expenses
    Mileage
    Office in Home
    Business Deductions

Latest News



 

 

 

 

 

 

 

 

Privacy Policy ......... About Us  ......  Disclaimer ..... Copywrited 2005 - 2006 & Developed by  Tax Moms