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IRC 1031 Exchange Explained

Internal Revenue Code provides that no gain or loss shall be recognized on the exchange of rental real estate is held for productive use in a trade or business, or for investment. A tax-deferred exchange is a method by which a real estate investors trades one or more relinquished rental real estate for one or more replacement rental real estate of like-kind. Such an exchange allows the issuer to defer the payment of federal income taxes and some state taxes on the transaction.

The theory behind internal revenue code is to allow the real estate investors to reinvest the sale proceeds into another rental real estate, foregoing any economic gains that may have been realized from the sale. If you have recently sold, or are thinking of selling rental real estate, we can assist in matching you with a qualified IRC 1031 realtor. An IRC 1031 realtor can help you explore your IRC 1031 exchange options. Contact us today for a free consultation.

Benefits of a IRC 1031 Exchange

Benefits to an IRC 1031 exchange include:

IRC 1031 Exchange Benefits
  • Deferred capital gains taxes

    IRC 1031 Exchange Benefits
  • The potential to yield more cash flow on an annual basis

    IRC 1031 Exchange Benefits
  • More money to reinvest in a newer rental real estate due to zero capital gains taxes calculated on the old rental real estate

  • Consolidate your investment portfolio by electing a tenancy in common exchange

    IRC 1031 Exchange Benefits
  • Achieve your investment goalsThe benefits of investing in a tenancy in common structured rental real estate are definitely worth investigating. You have the ability to:

  • Invest in larger, institutional grade properties.
  • Diversify Your rental real estate Portfolio

    Tenancy In Common Benefits
  • Diversify across different types and sizes of rental real estates as well as geographic markets, potentially increasing both the value and safety of your rental real estates.

    Completing an IRC 1031 exchange with a tenancy in common interest ownership in a rental real estate allows real estate investors not only to defer their capital gains taxes, but also to upgrade their rental real estate into larger, institutional-grade rental real estate.

    If you are interested in learning more about tenancy in common exchanges available to you, contact us today.

    Tenancy In Common Triple Net Lease

    A more popular alternative to sole triple net lease ownership is an investment in a single triple net lease commercial rental real estate by multiple real estate investors as individual real estate investors. This type of ownership is otherwise known as a tenancy in common ownership.

    Triple Net Lease-tenancy in common rental real estate can be either single tenant triple net lease or multi-tenant triple net lease rental real estate, and are commonly converted into such through a master lease. This type of lease is structured in such a way that they lease the rental real estate back from the real estate investor on a triple net lease basis.



    Tenancy In Common-triple net lease advantages include:

    1. Freedom from the hassles of day-to-day management

    2. Readily available rental real estate

    3. The opportunity to invest in higher-quality institutional rental real estate

    4. Assistance with the entire exchange process

    5. Flexible investment sizes based on rental real estate type and location




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