The Realized Team’s Picks
How to Use DSTs to Smooth Out Irregular Rental Income in Retirement
Navigating retirement as an investment property owner often entails the challenge of maintaining a consistent income stream. The unpredictable nature of rental income—fluctuating tenant occupancy, seasonal market shifts, and unexpected maintenance costs—can disrupt financial plans. Enter Delaware Statutory Trusts (DSTs) as a strategic solution.
Using QOZs After a Big Property Sale: When Does the Tax Tradeoff Make Sense for Retirees?
For many retirees contemplating the sale of a significant investment property, the opportunity to defer taxes through Qualified Opportunity Zones (QOZs) can be alluring. But when exactly does this tax tradeoff make sense? Let's delve into the intricate balance between financial strategy and individual circumstances to explore whether investing in QOZs is the right move after a major property sale.
Using DSTs and QOZs as an ‘Exit Ramp’ Without Losing Income
As an investment property owner, navigating the complex landscape of real estate can feel overwhelming, especially when considering exit strategies that do not compromise income. Delaware Statutory Trusts (DSTs) and Qualified Opportunity Zones (QOZs) present unique vehicles that can seamlessly transition your assets while deferring taxes and maintaining income, akin to taking an "exit ramp" on your investment journey.
1031 Exchanges and Capital Improvements: What Counts as ‘Like-Kind’ When You’ve Renovated Heavily?
Real estate markets are dynamic, and savvy investors often find themselves needing to upgrade their properties to enhance value and appeal. However, when planning to execute a 1031 exchange following extensive renovations, it becomes critical to understand what qualifies as a "like-kind" exchange. Essentially, a 1031 exchange allows property owners to defer capital gains taxes by swapping one investment property for another of equal or higher value. But when renovations alter the value of a property significantly, the lines can get a bit blurred.
Aligning Your 1031 Exchange Strategy with Your Estate Plan: Attorney and Advisor Checklists
For investment property owners, a 1031 exchange offers an indispensable avenue for deferring taxes and facilitating asset growth. However, aligning this strategy with a cohesive estate plan requires diligence and informed advice from both attorneys and financial advisors. Here's why this alignment is crucial and what you should consider during the process.
1031 Exchange Rules for Married Couples: Joint Owners, Community Property, and Estate Planning
Navigating the realm of real estate investment can be complex, particularly for married couples looking to leverage tax advantages like those offered by a 1031 exchange. These exchanges provide a mechanism to defer capital gains tax when exchanging like-kind investment properties, but when the nuances of marital property ownership come into play, things can get intricate.
Passive Income vs. Control: How Much Hands-On Involvement Do Retiring Landlords Really Need?
For landlords approaching retirement, the decision to shift from active property management to passive investment strategies is a pivotal one. As the years of dealing with tenants, repairs, and day-to-day logistics accumulate, many investors start considering ways to maintain or even increase their income without the constant hands-on involvement. The question becomes, how much involvement do retiring landlords really need to maintain control over their investments while enjoying a more relaxed pace of life?
Selling an Inherited Rental with a Stepped-Up Basis: Do You Still Need a 1031 Exchange?
Inheriting real estate can often feel like a financial windfall, but it also comes with significant strategic decisions. Investment property owners who inherit rental properties have a valuable tool at their disposal: the stepped-up basis. But what exactly does it mean, and how might it influence your decision to undertake a 1031 Exchange? This post explores these questions.
1031 Exchange and Divorce: What Happens to Your Rental Property and Tax Deferral?
Divorce is often an emotional and financial upheaval, further compounded when investment properties and 1031 exchanges are involved. For investment property owners, understanding how a divorce can impact a 1031 exchange and subsequent tax deferral is crucial.
How Rising Rates and Cap Rates Affect 1031 Exchange Options for Long-Held Properties
In recent years, the specter of rising interest rates has emerged as a significant influence on real estate investment strategies, particularly affecting the calculus of executing 1031 exchanges. As interest rates climb, property owners considering like-kind exchanges must navigate a landscape in which rising borrowing costs and fluctuating capitalization rates, or cap rates, could fundamentally shift the economic feasibility of these investments.
