What is Entitlement in Real Estate?
Concerning real estate development, entitlement is similar to approval. A developer must obtain an entitlement from the local authority to proceed with their project. If you think of zoning as the local rules that govern development, getting an entitlement is the goal. Zoning regulations contain broad restrictions on what type of building can be built in a specific area, while an entitlement is an approval for a particular project.
Can I Deduct Closing Costs for a 1031 Exchange?
One reason why real estate can be an attractive investment opportunity is because of the potential deductions involved with owning and maintaining income-generating properties (or those used for business purposes). When it comes time to sell that property, certain closing costs can be deducted (including mortgage interest and pro-rated property taxes).
How to Convert Your Investment Property Via an UPREIT Process
If you’ve owned real estate for business purposes (i.e., your work or for investment), you might have realized a significant appreciation on that property. This can lead to a good-news, not-so-good-news scenario.
Do You Pay State Taxes on Capital Gains?
Capital gains represent the difference between what investors pay for an asset (plus certain adjustments) and what they sell it for. Capital assets include real estate, stocks, bonds, collectibles, jewelry, antiques, and other items that can increase in value over time. If you don't sell the asset, any increase in its value is an unrealized gain, and won't be taxed, no matter how much the growth is.
How to Manage Commercial Real Estate (CRE)
Investing in commercial real estate can be an attractive way of generating income. The commercial real estate category covers office, industrial, retail, land, multifamily housing, and other miscellaneous sectors. However, in many cases, commercial property management requires more involvement and time than owning and managing single-family residential property.
Do I Have To Pay Capital Gains Taxes if I Am Over 55?
The Over-55 Home Sale Exemption was a provision in U.S. tax law that historically allowed individuals aged 55 and above to claim a tax break on the sale of their homes. However, this specific exemption was replaced in 1997 with a broader homeowner exemption policy. Contrary to some outdated information, the current tax legislation does not provide any capital gains tax benefits based solely on a homeowner's age. Nowadays, all homeowners, regardless of age, are eligible for a specific exemption on capital gains from home sales as long as they meet specific residency and ownership criteria.
Sale Proceeds vs. Cost Basis: What Is the Difference?
Sale proceeds and cost basis are numbers used when selling a home. Both are needed to calculate the amount an investor pockets from selling their real estate investment. We'll describe what both terms mean and how to apply them in practice.
How Does a 1031 Exchange Work in Florida?
A 1031 exchange refers to Section 1031 of the Internal Revenue Code. This section allows investors to defer capital gains taxes that would be owed on the sale of investment property. The essential elements of the procedure are:
What is an Assignment of Relinquished Property Contract?
The term “relinquished property” refers to the execution of a 1031 exchange, which is a tool that investors can use to defer payment of capital gains taxes due when they sell an investment asset and reinvest the proceeds. Because the benefit can be significant, the IRS closely regulates the conduct of these exchanges.
What is Revenue Procedure 2000-37?
The IRS closely oversees the eligibility of 1031 exchanges to ensure that taxpayers adhere to the rules in order to receive the potentially substantial benefits of the transaction. A 1031 exchange can allow an investor to defer the capital gains taxes that would be due on the sale of their investment property if they reinvest the entire proceeds (not just the gain) into a “like-kind” replacement property within 180 days.
