Advantages Of Tax Deferred 1031 Exchanges In Advance NC

By
Real Estate Broker/Owner with Premier Realty NC

A 1031 exchange is a way to delay taxes on the sale of one real estate for another. It applies to properties used for business or investment purposes. When executed properly, it may lead to dramatic savings. This article details the advantages of tax deferred 1031 exchanges in Advance NC.

Qualified Property

You must have a qualified property in order to consider a tax deferred 1031 exchange. Qualified real estate are those used for a business or for investment. They may be land, residential, rental, commercial, and industrial real estate. You must also buy similar property that is also qualified.

Advantages Of Tax Deferred 1031 Exchanges In Advance NC

Usually, when you sell investment property, capital gains taxes are due on earnings from the sale. This is true regardless of what the money is used for afterwards. Taxes can be owed to the federal and state government. Based on how long you kept a investment and the actual gain, the taxes levied may amount to a large sum. A 1031 exchange gives you a means to put the equity from one property directly into purchasing a new similar property and delay capital gains taxes until you sell that additional real estate. Another 1031 exchange could be performed on that future sale to defer taxes yet again.

Considering a 1031 Exchange

There are several elements to a 1031 exchange that you must learn about BEFORE marketing aproperty. 1031 Exchanges can not be performed after a sale is complete. You must intend to complete an exchange when you list qualified real estate for sale. Certain steps must be observed to complete the exchange. This includes deadlines for finding and buying replacement property. A qualified intermediary must also be involved to manage the process. If a deadline is missed, all savings will be void. Speak with a knowledgeable financial advisor for assistance with 1031 exchanges and to enjoy the advantages of tax deferred 1031 exchanges in Advance NC.

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Topic:
Home Selling
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North Carolina Davie County Advance
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1031 exchange
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