7 "DON'Ts" 1031 EXCHANGERS Should Know
Over my years as a REALTOR® in the Greater Asheville, NC area, I have seen strong appreciation in the real estate market.
During that same time,
I also have noticed with interest the increasing number of clients who are approaching creative-retirement ...the famous (or maybe infamous) "baby boomers".
I don't know if there is a connection between the baby boomers and 1031 investing in Asheville, but, just in the past few years, I can tell you for sure that the demand for information about 1031 Tax Deferred Exchanges under Carolina blue skies has "flowered".
( Carolina blue skies and flowers photo,
Also, I notice a trend in that more and more my clients want to know about 1031 "green" or ECO-friendly investments and whether they can qualify their vacation/second homes for an Like-Kind Exchange.
Although I have done many successful 1031 Exchange transactions, and have taken advanced training in this subject area I am NOT an expert on the intricacies of the IRS tax code. I like to refer my clients to those who are experts for details about the mechanics of the 1031 Exchange, especially in terms of Vacation Homes.
One thing I know for sure--In order to conduct a valid 1031 Exchange it generally is necessary to have such property rented to unrelated parties for a period of time both BEFORE and after the exchange, for example.) In making sure a property actually qualifies for the 1031 requirements INTENT is all-important.
In this regard, there are many details that a Qualified Intermediary explains and handles.Please do contact a QI before investing.
THE 7 DO NOT DO LIST I can suggest that investors DO NOT :
1) inadvertently indicate in a Contract that you intend to live in the property,
2) sign a listing agreement soon after its purchase,
3) apply for “owner occupied” financing on the property,
4) move into that property within a specified period of time,
5) ignore rental history (it must be rented by its tenants for a significant time)
6) claim the "mortgage interest" deduction for the property on yours tax return,
7) treat a 1031 investment property as a "time-share" arrangement. Section 280A of the Tax Code spells out the Test. Personal use of the property may not exceed the greater of: a). Fourteen (14) days; or b). Ten percent (10%) of the number of days that the property is rented at fair market value to others.
copyright greenolina 2007
Your Home for Today and Tomorrow- Smart UP-Fitting
GO HERE - for Tips & Talking Points.
Home Decorating, New Space Design
"Helpful starting points for talking about and designing
a functional and BEAUTIFUL lifelong home."
Asheville NC Real Estate Journal for RESOPURCES & REFERRALS -Mountain Homes and Land Legacies- Asheville 1031 Realty© 2014. Designations: NAR GREEN®, EcoBroker®, Eco Certified ®Real Estate Consultant, ePRO®. Unauthorized reproduction of any information including photos and graphics on this site is a violation of existing copyright laws. All rights reserved.
he Necessary Disclaimer! We disclaim liability for damages or losses, direct or indirect that may result from use of or reliance on, information contained in the blog or for accuracy of comments or opinions of visitors to our blogs.
* INFORMED CHOICES* THOUGHTFUL ADVICE* DATA INTERPRETATION*
-Tell us what is most important to you-
Email me janeAnne@janeAnne.com or give a call at: 828-776-0779