Sunday, February 21, 2010
Are you considering an 'upgrade'? Will you sell an investment or rental home to purchase another? You need to consider the tax implications of such a sale. As a second, rental, or investment home your profits are likely taxable, unless you take advantage of an IRS rule known as a "like-kind" exchange. This is sometimes referred to as a IRS 1031 exchange.
Think of a 1031 exchange as being similar to a IRA rollover, except with real estate instead of securities. There are lots of rules that need to be followed and you will need to hire an 'exchange agent', but the benefits of a 1031 exchange can be enormous. Check out 1031 exchanges on the Parker-Scheer website...Here.