Realized Author: David Dahill

Co-Founder & CFO

David Dahill

David’s Recent Posts

You Can Do a 1031 Exchange on a Primary Residence—Here's How

You Can Do a 1031 Exchange on a Primary Residence—Here's How

One of the frequent questions we get is: “can I use my primary residence in a 1031 tax-deferred exchange?” Unfortunately, the IRS' short answer is a definite no. Your home is your home, and a 1031 exchange is used to defer the capital gains taxes due on an investment property. However, as is usually the case under the Internal Revenue Code, exceptions exist.

Feb 28, 2022

The Other DST – Deferred Sales Trust

The Other DST – Deferred Sales Trust

Purchasing fractional shares of Delaware Statutory Trusts (DSTs) and completing 1031 exchanges are common strategies for real estate investors seeking to defer capital gains taxes when they sell investment properties – but they aren’t the only options.

Feb 11, 2022

What Is the 65-Day Rule?

What Is the 65-Day Rule?

While income tax rates and rules for individual and married taxpayers are complicated enough, the application of rates and thresholds to trusts adds a layer of complexity to financial planning. The 65-day rule relates to distributions from complex trusts to beneficiaries made after the end of a calendar year. For the first 65 days of the following year, a distribution is considered to have been made in the previous year.

Aug 6, 2021

How to Record Payments to Qualified Intermediaries Via Form 1042-S

How to Record Payments to Qualified Intermediaries Via Form 1042-S

Form 1042-S is sent to non-U.S. residents who have income in the U.S. Income is from U.S.-based entities. This income includes distributions from real estate properties or funds. A Form 1042-S must be filed for each type of income reported.

Jul 28, 2021

Part 3: Using Tax Planning In an Effort to Increase Returns – Real Estate Exchanges

Part 3: Using Tax Planning In an Effort to Increase Returns – Real Estate Exchanges

At Realized, we believe that tax planning in real estate is about seeking opportunities that can help ensure that the amount of money you make remains money you keep. In our final post in this series, we’ll cover an additional tactic to consider when seeking ways to increase your after-tax cash flow: leverage tax-deferred real estate exchanges.

Jul 6, 2021

Part 2: Using Tax Planning In an Effort to Increase Returns – Increase Your Cost Basis

Part 2: Using Tax Planning In an Effort to Increase Returns – Increase Your Cost Basis

At Realized, we believe that tax planning in real estate is about seeking opportunities that can help ensure that the amount of money you make remains money you keep. In our second post in this series, we’ll cover an additional tactic to consider when seeking ways to increase your after tax-cash flow: increasing your cost basis.

Jul 2, 2021

Part 1: Using Tax Planning in an Effort to Increase Returns – Leverage Depreciation

Part 1: Using Tax Planning in an Effort to Increase Returns – Leverage Depreciation

At Realized, we believe that tax planning in real estate is about seeking opportunities that can help ensure the amount of money you make remains money you keep. And knowing your actual, taxable cash flow is one opportunity. In this three-part series, we’ll examine different ways to use tax planning that are designed to help keep potential profits in your pocket.

Jun 28, 2021

Form 8824 - Section III Explanation

Form 8824 - Section III Explanation

Form 8824 is the part of an investor’s tax return that contains 1031 exchange transaction information. Section III of the form determines the net results of the transaction (gain or loss). This section is the 1031 exchange transaction and how the IRS receives information about the transaction’s gain or loss for tax reasons. 

May 14, 2021

What is a Partial 1031 Exchange?

What is a Partial 1031 Exchange?

Often, 1031 investors would like to set aside a portion of the money from their property sale. Perhaps they have college tuition or an upcoming wedding to consider. This begs the question: Is it possible to keep a portion of a property sale’s proceeds while still deferring the majority of taxes with a 1031 exchange?

Jul 6, 2020

Can Foreign Investors Do 1031 Exchanges?

Can Foreign Investors Do 1031 Exchanges?

Can foreign investors take advantage of IRS §1031 to execute a tax-deferred exchange when selling their U.S. real estate assets? The short answer is yes. The longer answer is a bit more complex. Congress enacted the Foreign Investment in Real Property Tax Act of 1980 (“FIRPTA”) to impose a tax on foreign investors selling real property assets in the United States. The act requires that anyone who buys real estate assets from foreign persons or entities must withhold a prescribed part of the purchase price, which would normally go to the foreign seller. Why exactly? To ensure that the foreign seller pays capital gains taxes when they are due.

Jun 21, 2020

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