Tax-Deferred and Tax-Exclusion Strategies Other Than 1031 Exchanges on Go Ahead, ASK! Podcast Ep. 08

1031 Exchange Often Best Strategy 

The 1031 Exchange is often the right tax-deferred strategy for investors to use when selling rental, investment or business use real property, but not always.  It's important to keep the other more common tax-deferred and tax-exclusion strategies in mind just in case they are more appropriate under certain circumstances. 

Other Tax-Deferred and Tax-Exclusion Strategies 

Investors need to at least be aware of Section 1033 Exchanges, Section 1034 Exchanges, Section 721 Contributions (upREITs), Section 121 Exclusions, Section 453 Installment Sales, Charitable Remainder Trusts (CRTs), and Delaware Statutory Trusts (DSTs).  

As with any income tax strategy, especially certain tax-deferred and tax-exclusion strategies for rental, investment or business use real estate, there is confusion surrounding the topic.  There are always lots of opinions that sound like fact.  

The Exeter Group Unravels the Mystery of Other Tax-Deferred and Tax-Exclusion Strategies that might be appropriate for investors under certain circumstances.  Join Lauren Speidel, Regional Manager and Bill Exeter, President and Chief Executive Officer, The Exeter Group now....

Tax-Deferred and Tax-Exclusion Strategies Other Than 1031 Exchanges

1033 Exchange Consulting Services

Increase in 1033 Exchanges
There has been a pretty significant increase in the number of 1033 Exchange transactions occuring over the last year or so, and I would not be surprised to see the number of 1033 Exchanges continue to increase over the next couple of years as well.

Spurred by Stimulus Spending
And, its not surprising. The number of government stimulus programs have increased dramatically and therefore have increased Federal, state and local government spending. This increase in spending by government agencies will naturally increase the number of properties taken via the eminent domain process in order to complete the public projects.

1033 Exchange Consulting Services
We are not attorneys, but have extensive experience and expertise in the area of 1033 Exchanges because of our almost three decades of related involvement with 1031 Exchanges. Call The Exeter Group, LLC for a free consultation to see if we can help you.

Threat Of Eminent Domain or Condemnation

More Eminent Domain Threats
I am being retained by more and more clients that have been threatened with eminent domain or condemnation proceedings recently. It is an interesting trend considering the current economic landscape that we are working in, but it is also one that will probably continue to grow as more and more cities receive some portion of the economic stimulus funds that are available and need to acquire or take land in order to spend the money.

The purpose of this article is to cover three important issues here.

Never Panic
First, don't panic should you be confronted with a threat of eminent domain or condemnation or find yourself going through an actual eminent domain proceeding. The eminent domain process can be very overwhelming, but it often works out well for you as the property owner. I would be happy to walk you through what to expect.

Get Your Own Valuation
Second, don't roll over and merely accept the first offer that the city, state, Federal Government or other agency shows you. They will often try to low ball you. Get your own real estate appraisal or business valuation. You need to know what is fair so that you can protect yourself and negotiate for the best possible price.

Tax Deferred Exchange
You can structure a tax-deferred exchange pursuant to Section 1033 of the Internal Revenue Code ("1033 exchange") and defer the payment of your depreciation recapture taxes and capital gain taxes by acquiring another replacement property.

Consulting Services
We are one of the few consulting groups in the country that really understand the 1033 tax deferred like kind exchange transaction, including the special structures and how it differs from the 1031 tax deferred exchange transaction. Please feel free to call us for assistance.