Does Deferred Income Count as Earned Income?
A deferred income plan isn’t just another name for a retirement plan. There are two types of deferred income plans — qualified and non-qualified. Is it considered earned income when you contribute to one of these plans? Does it matter? We’ll discuss the differences in these plans and cover if their income is considered earned.
Are REITs a Good Investment During Inflation?
Some people consider direct real estate investments to be an inflation hedge. But direct real estate investing and REIT (real estate investment trust) investing are two very different worlds. Are REITs also considered an inflation hedge? That’s what we’ll explore in this article.
What is a Cap Rate in Real Estate?
Since real estate investors don’t have crystal balls they can consult when considering which properties merit their investment capital, they turn to cap rates instead.
What Is An A-B Trust?
Individuals sometimes use an A-B trust, or bypass trust, in their last will and testament or living trust for potential estate tax benefits. It is generally only used by couples whose estate is over the estate tax filing threshold, which in 2022 was $12.06 million.
Can You Choose an Escrow Company as Your Qualified Intermediary?
Successfully completing a 1031 exchange requires meticulous attention to detail. Exchangors don’t have to worry about navigating every single detail of their exchanges, however – that job falls on the Qualified Intermediary.
Can an Estate Use a Section 121 Exclusion?
The Section 121 exclusion is a great tax benefit for homeowners. It allows them to exclude taxes on gains up to a certain amount if they meet the Section 121 criteria. That’s nice for homeowners, but what if the home is within an estate? Does the home still get the exclusion?
What are the Two Kinds of Boot in a 1031 Exchange?
Real estate investors have used 1031 exchanges for decades to defer capital gains tax liabilities generated from the sale of investment properties.
What is the Difference Between Inheritance Tax and Estate Tax?
Inheritance and estate taxes have common threads, but they are different. Taxation and how it is applied for both are quite different. Not everyone will have to worry about these two taxes. Most states do not have either one. But some states have both. These may sound like confusing taxation laws so let's unwind both.
What Assets are Subject to Depreciation Recapture?
Depreciation of fixed assets provides an important tax deduction for real estate investors and business owners. Depreciation can be applied to a wide range of long-term fixed assets. It’s an important tax provision because it allows businesses or investors to deduct a portion of the cost of buying physical assets over time instead of all at once. Depreciation deductions also lower taxable income, which can help maximize tax savings.
What Happens When a 1031 Exchange Straddles Two Tax Years?
Some 1031 exchange executions start in one year and finish in another. This is called straddling tax years. Usually, this is no more than two years. What are the tax consequences when a 1031 stretches across two years, and what does it mean for the outcome of the 1031?
