What are my chances of being audited?
What are my chances of being audited? Currently The IRS audits approximately 1% of all returns. The Qualified Intermediaries who must respond to audits do
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What are my chances of being audited? Currently The IRS audits approximately 1% of all returns. The Qualified Intermediaries who must respond to audits do
What does Form 8824 require? It will ask you the date you sold your relinquished property, identified and acquired your replacement property. In addition you
How do I report my exchange to the IRS? Form 8824 needs to be completed as part of your annual Federal return. Remember you cannot
If I purchase a DST do I have to stay in it for the entire holding period? If an investor decides to sell his interest
How do I identify properties for the Qualified Intermediary? The essence is the identification must be “unambiguous,” i.e., site specific.
What is Like Kind property? Like kind property, provided it is held for investment, can include commercial, single family rental properties, raw land, apartments, industrial
Can I sell two properties and exchange them into one replacement property? Yes. Two basic rules are critical: 1. The time period (45 day and
Can an exchange include Seller financing? Yes. At settlement the note must be assigned to the Qualified Intermediary and when sold the proceeds are sent
Can I take cash out of a 1031 exchange? You cannot take cash out without creating a taxable event. The cash you take out will
What is Boot, Cash Boot and Mortgage Boot? Boot is constructive receipt of non-like kind property. It is taxable to the extent there is a
General Disclosure
Not an offer to buy, nor a solicitation to sell securities. All investing involves risk. Past performance is not indicative of future results. Speak to your finance and/or tax professional prior to investing. Information provided on this website is for educational purposes only, and is not a guarantee of performance. Offerings of the type discussed herein are available only via private placement memorandum, and are limited to accredited investors.
Securities offered through Emerson Equity LLC Member: FINRA/SIPC. Only available in states where Emerson Equity LLC is registered. Emerson Equity LLC is not affiliated with any other entities identified in this communication
1031 Risk Disclosure:
There is no guarantee that any strategy will be successful or achieve investment objectives;
Potential for property value loss – All real estate investments have the potential to lose value during the life of the investments;
Change of tax status – The income stream and depreciation schedule for any investment property may affect the property owner’s income bracket and/or tax status. An unfavorable tax ruling may cancel deferral of capital gains and result in immediate tax liabilities;
Potential for foreclosure – All financed real estate investments have potential for foreclosure;
Illiquidity – Because 1031 exchanges are commonly offered through private placement offerings and are illiquid securities. There is no secondary market for these investments.
Reduction or Elimination of Monthly Cash Flow Distributions – Like any investment in real estate, if a property unexpectedly loses tenants or sustains substantial damage, there is potential for suspension of cash flow distributions;
Impact of fees/expenses – Costs associated with the transaction may impact investors’ returns and may outweigh the tax benefits.
