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Barstow 1031 Exchange

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1031 Exchange defer Capital Gains

When you sell investment/ income real estate you have to pay capital gains tax on the gain from the sale of land or investment/ income homes. The gain is caused by either taking depreciation deductions for tax purposes or from the appreciation over time of land or investment/ income homes.

The IRS Section Barstow 1031 Exchange offers the major exception to defer capital gains tax normally due on the sale. With the Barstow 1031 exchange you can sell land, investment/ income homes or business, and utilize the proceeds in the purchase of the land or investment income homes of equal or greater value without having to pay capital gains tax.

There are several benefits to consider with a Barstow 1031 Exchange. For example, you could use the proceeds to buy bare land and construct a building on it, consolidate several investment/ income homes into one to ease management and put all funds into a more valuable land or investment income homes, take one land parcel or investment/ income homes and diversify into several land parcels or investment/ income homes, and purchase commercial property from residential proceeds.

To qualify for a Barstow 1031 Exchange, you need to sell land or investment homes that was held for business or real estate purposes for the purchase of other business or land or investment/ income home. However, YOU CANNOT sell investment land or investment/ income homes for the purchase of personal property, as this would not qualify for a tax deferral under section 1031.

On a Barstow 1031 exchange, to avoid any taxable gain you must reinvest all the Capital gains and purchase land or investment/ income homes of equal or greater value. From the date that your old/former property CLOSES, you have 45 days to declare one or more land parcels or investment/ income homes you will purchase. From the date of CLOSING of your old/former land or investment/ income homes you have 180 days to CLOSE one or more land or investment/ income homes on your 45-day list.

The entity that is on the title of the old/former land or investment/ income homes must remain on the new land or investment/ income homes title. A qualified intermediary, sometimes known as an Accommodator, can only handle the proceeds from the sale of the old/former land or investment/ income homes. In a Barstow 1031 exchange, you cannot personally touch the money nor can a friend, broker, employee, CPA, or attorney hold the money for you.

There are several ways to use the Barstow 1931 exchange and numberious situations the 1031 exchange can be an advantage to investors. We suggest all investors research how the Barstow 1031 Exchange can benefit them. There are many companies specializing in the area.

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