Is The Timing Right for a Tax Free Exchange?

If you own investment property, now may be the perfect time to sell it and do a tax free exchange. You might say, prices are low and why should I sell now? The fact is you might take advantage of the prices being low by selling a property that is not appreciating or cash flowing and purchase one or more properties that are distressed and have great potential for appreciation. We have many homes for sale in Wilmington NC that would qualify for a tax free exchange. We even have Wilmington NC real estate priced under $100 a ft!

Tax Free Exchange Benefits

•    You are allowed to defer your taxes on the sale or exchange of “like properties”.
•    More money is at your disposal to invest in another property.

Do keep in mind that the replacement property must equal or exceed the value of the property exchanged. Also, all of the proceeds must be used to acquire the replacement property.

Tax Free Exchange Time Requirements

Time Requirements for a 1031 tax free exchange are very simple. You must identify the replacement property within 45 days after the transfer date of the property to be exchanged. And the exchange must be completed with 180 days after the transfer. Please consult your CPA for complete details.

Kay Baker may be contacted at kay@cbbaker.com or log on to www.cbbaker.com.