"In What Year Will The Economic Recovery Really Begin?

Confused About What To Do Next in Real Estate?
The "Great Recession" has left many of us scratching our heads and wondering what's next? Where do we go from here? How should we reposition our real estate portfolio going forward now that we are emerging from the recession? Should I hang tight, or make an investment move now?

We realize these are confusing times, which is why Exeter 1031 Exchange Services, LLC is hosting this webinar for you. Our goal is to provide you with up-to-date real estate market data and information so that you can make better informed investment decisions.

"In What Year Will The Economic Recovery Begin?"
This exciting webinar will provide an update on the real estate market on a local, state and national point of view as well as an overview of certain demographic trends that will affect investment property. It will help you answer the above questions, and help you decide how to position your own investment portfolio as we move forward beyond the recession.

Hosted by:

William L. Exeter

President and Chief Executive Officer

Exeter 1031 Exchange Services, LLC

Presented by:

Alan N. Nevin

Director of Economic Research

MarketPointe Realty Advisors

Date and Time

Tuesday, May 24, 2010

10:00 AM — 11:00 AM PDT Webinar

Please login five (5) minutes early

Go To Webinar Registrations Are Required
Click here to register for this webinar about demographic trends in California.

"In What Year Will The Economic Recovery Begin?"

Has The Recovery Really Started?

The media is full of comments and opinions today about the global economic recession and/or the recovery.  When is the recovery coming?  Is the recovery here; I mean really here? 

These questions about the status of the economic recovery lead to many more questions about what each of us should or should not do in order to take full advantage of the economic recovery as it unfolds before our eyes.  How should we reposition ourselves for the job market, or our securities portfolio or our real estate portfolio?  What should we do differently, if anything, from what we have been doing?

How Will The Recovery Affect Us Individually?

The recovery will affect each and every one of us differently.  It will depend on what industry we are in, what jobs we have, what kind of investments we have made, and what kind of real property we own, etc.  The actions that each of us should take will vary depending on our individual circumstances.

Real Estate Hit Particularly Hard

Those of us in the real estate industry have been hit particularly hard.  So, the biggest question for each of us individually is really when and how will the recovery reach us and how will it ultimately affect us, especially those of us in the real estate world.

Alan NevinTo help us answer these questions on an individual basis, we desperately need current, reliable and accurate information to help us make better informed and educated investment decisions when trying to decide what we should do going forward.

Alan Nevin

So, we invited Alan Nevin, Director of Research with Marketpointe Realty Advisors, and co-founder of The Center for Wealth & Legacy™, to discuss these economic issues and questions with us on a Webinar entitled The Reality of the California Real Estate Market: In What Year Will The Economic Recovery Begin?"
Alan Nevin is an economist and a demographer who will address the various economic and real estate industry trends from a local (San Diego), state (California) and national (U.S.) perspective.  He will also share some comments regarding the global economy and how the U.S. fits into and/or will be affected by the bigger global economic picture.

Webinar Sponsor by Exeter 1031 Exchange Services, LLC

Exeter 1031 Exchange Services, LLC understands that investors need information in order to make tough investment decisions in difficult economic markets like today, so Exeter is pleased to host and sponsor this free webinar for real estate investors.  Click here to register for this free webinar.

IRS Rules On Failed 1031 Exchange Transactions When 1031 Exchange QI Fails

Revenue Procedure 2010-14 was issued today by the Internal Revenue Service to help investors that were affected by 1031 Exchange Qualified Intermediaries that failed to complete the investor's Like Kind Exchange by acquiring and transferring replacement property to the investor.

The Rev. Proc. 2010-14 provides a safe harbor method of treating and reporting capital gain or loss for certain taxpayers who initiate tax deferred exchanges under Section 1031 of the Internal Revenue Code but fail (default) to complete their 1031 Exchange because their Qualified Intermediary has failed to acquire and transfer like kind replacement property to the investor.

The Internal Revenue Service will not treat investors that meet the requirements of Rev. Proc. 2010-14 as being in actual or constructive receipt of their 1031 Exchange funds when the investor did not complete his or her 1031 Exchange because of their Qualified Intermediary (QI) defaults and becomes subject to a bankruptcy or receivership proceeding.

Revisiting Depreciation Recapture Issues When Cashing Out (Not 1031 Exchanging)

It is that time of year again when we field many questions regarding the reporting and tax treatment of 1031 Exchanges, or lack of 1031 Exchanges, on taxpayers income tax returns. 

There seems to be many more questions this year because many taxpayers just sold and cashed out rather than 1031 Exchanging again, and now have significant income tax liabilities. 

The one income tax issue involved with rental property that is often misunderstood is depreciation recapture.  Depreciation is mandatory if you buy and hold rental property or investment property, and the depreciation is deferred into the future upon sale of the rental property as long as you are structuring a 1031 Exchange transaction.  However, the depreciation will be recaptured upon sale if you are not 1031 Exchanging.

This is the reason that we have noticed an increase in depreciation recapture questions.  So, I thought that I would link to an discussion board post on depreciation recapture that will help explain the issue in greater detail.

1031 Tax Deferred Exchange of Internet Domain Names or URLs

I was speaking with a "Domainer" today and I thought this would be a good subject for my next blog post regarding 1031 Exchanges.  He was asking whether a Domainer could 1031 Exchange Internet domain names or website URL addresses for other Internet domain names or website URL addresses. 

What Is A Domainer?

First, you are probably asking yourself right about now what in the world is a "domainer" and what do they do.  I think you will be facinated by the technical definition.  I had to look it up for this post to make sure that I got it right, although I already had the general idea about domainers and domaining. 

Essentially, a domainer is someone that buys, sells, owns, and invests in Internet domain names or URL addresses for profit.  Domainers may buy and hold domain names/website URLs for sale or they may buy and position domain names/website URLs to product cash flow through a variety of strategies. 

Can You Defer Taxes On Sale of a Domain Name?

The question asked by this specific Domainer that called me was whether he could defer the payment of his capital gain taxes that resulted from the sale of an Internet domain name or URL address by buying (reinvesting in) another Internet domain name via a tax-deferred exchange. 

The short answer is yes.  The majority of taxpayers that are aware of 1031 Exchanges generally think that the strategy only applies only to real estate.  However, you can 1031 Exchange personal property, such as Internet domain names, as long as the Internet domain name was held for income production, investment or used in a trade or business. 

Domain names that are bought and held specifically for sale will not qualify for tax-deferred exchange treatment through a 1031 Exchange because they are treated as inventory in the Domainer's business and not as an asset used in the business or acquired and held for investment. 

Intent to Hold for Investment is Critical

The critical element in a 1031 Exchange of domain names is the Domainer's intent to hold the domain names for investment (as opposed to intent to hold as inventory for sale).  The sale and exchange of an Internet domain name that was acquired and held for investment or cash flow will qualify for 1031 Exchange treatment.  The sale of an Internet domain name that was merely bought and held with the intent to sell will not qualify for 1031 Exchange treatment.