CAN MY CLIENT TAKE SOME CASH OUT WHILE STILL DOING AN EXCHANGE?
Yes! However, any cash received will be subject to capital gains tax. Your client may take cash out at the closing of the sale property or upon completion of the exchange. Since they will be taxed on any proceeds being removed from the exchange, it will also be necessary to determine what their capital gain would be had they simply sold their property. If they take cash out equal to or more than their capital gain, then they will be paying all the tax owed. An exchange at this point would be a useless exercise.
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