real estate investment: What is a Reverse exchange?
- 04/10/08 11:10 AM
REVERSE EXCHANGE: The reverse exchange is a specialized exchange arising from a situation in which an exchanger must acquire the replacement property prior to selling their relinquished property. Since it is impossible to exchange properties when you own both properties at the same time, a reverse exchange is required if the replacement (purchase) property escrow must close before the relinquished (sale) property escrow closes. Types of Reverse Exchange Transactions Type A: The Intermediary assigns into the purchase contract and takes title to the replacement property. The exchanger has 180 days from close of escrow on the replacement property to sell the … (0 comments)
real estate investment: What is a Delayed Exchange?
- 04/10/08 05:14 AM
DELAYED EXCHANGE: As an investor in real estate, you understand how important it is to preserve your wealth and assets. If your investment property has appreciated in value or you have depreciated the property, a sale would require the payment of tax on the capital gain of up to 30% or more (combined federal and state). However, if you were to exchange your property utilizing the benefits of IRC Section 1031, you can defer the tax on the gain, allowing reinvestment of all your equity. The 1031 Tax Deferred exchange offers great flexibility to the investor. You may exchange one property … (0 comments)
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