The Realized Team’s Picks

How Do I File a 1033 Election?

Each year we bear witness to yet another out-of-control wildfire that devastates an entire California community, or another destructive hurricane wracking the Eastern Seaboard or the Gulf of Mexico.

Can Additional Census Tracts Be Nominated as Opportunity Zones?

No one will likely soon forget the many painful financial lessons learned during the Great Recession, especially real estate investors who saw their property values plummet by more than half when the U.S. housing bubble burst in 2008.

Strategies for Deferring and Reducing Capital Gains [Webinar Recap]

Enacted in 1921, IRC 1031 allows investors to defer all federal and state capital gains and depreciation recapture taxes when selling property by reinvesting, or “exchanging” their equity into a “like-kind” replacement property. Investors can use this strategy in hopes of building wealth on a tax-deferred basis by reinvesting 100% of that equity.

How Soon Can I Refinance a 1031 Exchange Property?

Refinancing an investment property is the process of paying off an existing loan and replacing it with a new one that has different terms. Investors may seek to refinance a loan’s terms for one or more of several reasons:

What Happens to Depreciation When You Sell a Rental Property?

For real estate investors, annual depreciation expense is one of the main draws for real estate investing. It’s sometimes called a phantom expense because investors pay no out-of-pocket expense. But the expense’s effect is real — potentially lowering an investor’s tax bill.

Can a Qualified Opportunity Fund Invest in a REIT?

Qualified Opportunity Funds (QOFs) are the vehicles that investors can use to participate in the Opportunity Zone program, which was created by the 2017 Tax Cuts and Jobs Act (TCJA). Opportunity Zones are federally designated areas in need of economic growth and investment. In exchange for directing investments in the targeted regions, taxpayers can defer and reduce their taxes on invested funds under certain circumstances. Here is how the program works:

Can an Installment Sale Be Used in a 1031 Exchange?

Completing a 1031 exchange can be an excellent method of making changes in your real estate portfolio while deferring capital gains and other tax obligations. However, the effort requires advanced planning and discipline to succeed. Investors should begin considering potential replacement assets before selling the property targeted for relinquishing in most cases, particularly when competition for real estate is challenging, as it is today.

Do Opportunity Zones Offer Annual Returns?

There are more than 8,760 Opportunity Zones located in all 50 States, the District of Columbia, and five United States territories, many of which have experienced a lack of investment for decades. Qualified Opportunity Zones (QOZ) can provide investors with attractive tax advantages and there’s an ability for OZs to offer annual returns; however, there is no assurance of investment returns, profits, or property appreciation in an Opportunity Zone investment.

1031 Exchange Alternatives to Consider

Investing in real estate can be complicated, especially when it comes to selling your investment property. Taxes can take a big chunk out of your proceeds, but there are ways you can shelter your gains. One popular method used by investors to defer capital gains is the 1031 “like-kind” exchange; however, there are alternative methods to consider.

What is the Difference Between a Will and a Trust?

Defining a Will: A will, also known as the last testament, is a legal document that enforces how a person’s assets will be allocated after their death. A will serves more functions than just distributing the assets of a deceased person. In fact, a will is a crucial component of estate planning.