Can Banks Use Opportunity Zones?
Mention the term “opportunity zone,” and what might come to mind are “capital gains,” “investors,” and “tax deferral.” Basically, entities can invest capital gains from the sale of assets into Qualified Opportunity Funds (QOFs) to defer any taxes on those profits.
Qualified Intermediary Withholding: Everything You Need to Know About QI Agreements, Statements & Foreign Partnerships
Mention the words “Qualified Intermediary” and the next thing that might come to mind is “1031 exchange.” Certainly, QIs are essential when it comes to the successful execution of a real estate like-kind exchange. In this case, the entity, also known as the accommodator, acts to change a sale to a buyer and a purchase from a seller into an exchange of the one for the other. In addition, the QI prevents the taxpayer from being considered in actual or constructive receipt of the proceeds during the interim period between the sale and purchase.
What Government Agency Oversees 1031 Property Exchanges?
A 1031 Exchange is a way for investors to defer the capital gains taxes on investment real estate. The process gets its name from the relevant section of the Internal Revenue Code, which allows an investor to defer the gain when investment property is sold if they reinvest the proceeds into another investment property of the same or greater value.
Which Characteristics Make a Security Most Subject to Liquidity Risk?
All investors face some level of potential liquidity risk. Some securities are more prone to liquidity risk than others. In an effort to manage liquidity risk, there are particular characteristics that you can look out for. Let’s walk through them.
Can a C Corp Invest in an Opportunity Zone?
Much of what has been written about the Opportunity Zone program seems to focus on individual investors and specially formed LLCs that are treated as partnerships or corporations. In these arrangements, such entities funnel capital gains created from the sale of investments into Qualified Opportunity Funds (QOFs). Those funds are then invested in Qualified Opportunity Zones, or QOZs.
What Is Alternative Minimum Tax (AMT), and Who Pays It?
The alternative minimum tax or AMT is in place to ensure that all taxpayers pay at least some taxes. Under tax law, taxpayers can strategically use tax deductions and credits to significantly reduce the amount of taxes they owe. As a result, those with high incomes may end up with lower tax obligations. The AMT is intended to prevent taxpayers from avoiding their share.
Tenant In Common (TIC) Purchase Interests Agreement: What it Includes & Important Items to Consider
Tenancy in common (also referred to as TIC ) is one way for investors to own real estate in concert with others. In a TIC structure, the co-owners can own different shares (in other words, Owner A might hold 90% while Owner B holds the remaining 10%; or ten co-owners could have equal shares), and they do not have the right to survivorship if one of the other owners dies. Tenancy in common is sometimes conflated with joint tenancy, but those two differences are fundamental: in a joint tenancy, the owners hold equal shares and maintain the right to survivorship.
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.
Can You Do a 1031 Exchange from a Residential to Commercial Property?
A residential property that is not a primary residence and meets the 1031 exchange criteria can be exchanged into a commercial property. Outside of following the 1031 exchange rules, there really aren’t any special considerations. The investor is basically going from a smaller investment property to a larger one. In this article, we’ll look into the details of what’s involved when doing a 1031 exchange from a residential to commercial property.
