SCES 1031

🚨B I G A N N O U N C E M E N T 🚨

We have merged our 1031 exchange company with a tech-forward Qualified Intermediary. 😱

This merger allows us to expand our reach while maintaining our commitment to exceptional client experiences. We are excited to continue working with our local community, enhancing our services to our clients with more tools that makes the process incredibly streamlined for everyone.

This is an incredible opportunity, a meeting of the minds, a way to transform our industry for the better - and we’re excited to be at the forefront!

Thank you to our clients, escrow officers, lenders, real estate agents/brokers, financial advisors, and everyone in between for your continued support. It means the world 🌎 to us!!

🙏 #1031 🌱

The longer you own an investment property, the less likely the IRS will question whether or not it qualifies for a 1031 exchange.

1031 exchanges are designed for Long-Term investors. If you purchase a property in order to fix it up quickly, and turn around and try to sell it, by utilizing a 1031 exchange, you are raising a red flag 🚩

Short Term investors do not get the benefit of deferring the long term capital gains tax rates. If you are questioning which type of investor you are, long term or short term, then you need to get legal advice on whether or not they think your property will qualify.

There are several other factors that could affect whether or not your property qualifies for a 1031 exchange, besides how long you’ve owned and reported the property. Want to know more?

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Looking for a creative way to re-invest your 1031 exchange funds?

Consider buying a mixed-use property that has an ADU in the back. You can buy the whole property but use your exchange proceeds towards to allocated percentage the ADU represents from the whole property.

By doing so, you can buy a new primary residence and investment property, satisfying your personal and investment needs.

Or, you can buy the whole property as an investment that offers two sources of rental income… win win 🏆!

The best advice I can offer you, if this is something you are truly considering, get the property appraised before you submit your offer and go over the figures with your accountant to get their legal opinion to see if the numbers work for your specific 1031 exchange situation.

ADUs are becoming increasingly popular and may offer a creative solution that benefits your financial goals.

Of course you must follow specific requirements in order to comply within the 1031 exchange parameters. Want to learn more?

DM the word: ADU and we’ll contact you with more information.

Follow for more creative solutions for your 1031 exchange needs.

1031 exchanges are quite streamlined but can easily be sabotaged by real estate investors either by receiving poor advice or are simply uneducated on the subject. 😬

We are here to help clear the confusion 🌬️

First things first, find a reputable 1031 exchange company such as to properly document your exchange and securely hold your funds until you re-invest them into another investment property. Your exchange cannot be recognized without this step.

Second, make sure you find replacement property options and identify them, in writing, by the 45th day from the closing of your relinquished property.

📌 This step is crucial as you CANNOT move forward without it.

As long as you’ve completed the last step you are able to proceed with your exchange but you must close on the replacement property ON or BEFORE the 180th day, not a day after.

Other factors that are less common but could could derail your exchange are:

➡️ Flipping property. This applies to both the relinquished AND replacement properties. Both properties need to be held long term. This means the property you are relinquishing has been held for 1-2 yrs before you open an exchange. And, the property you are replacing needs to be held and reported as an investment property for the same duration.

➡️ Personal property does NOT qualify. This means your primary residence and 2nd homes are excluded from 1031 exchange treatment. Vacation homes may be an exception to the rule AS LONG AS you are using the property for either 2 weeks out of the year OR 10% of the time rented, whichever is greater.

For more info on 1031 exchanges make sure to follow

#1031