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 What is a 1031 Exchange?
 
 Elements of an Exchange
 
 Types of Exchanges
 
 Exchange vs. Sell
 
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1031. Exchange of property held for productive use or investment
No gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment if such property is exchanged solely for property of like kind which is to be held either for productive use in a trade or business or for investment.



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Conventional Loan Financing
Conventional loans are secured by government sponsored entities or GSE's such as Fannie Mae and Freddie Mac.

Resources & Links
Home Warranty Can Save You Hundreds!
Traditionally, home warranties have protected homeowners from repair costs that aren't covered by home insurance. Home warranties cover such things as the plumbing, heating, air conditioning, and major appliances

What is a 1031 Exchange?
1031 Tax Deferred Exchange Law
IRS Code 1031 allows for an investor of real property to defer his capital gain upon the exchange of investment property of a like kind. In other words, you can trade an existing property for a new property or properties without having to pay taxes on your gain. The tax liability is deferred into the new property(ies).


Resources & Links
A HOUSING BUBBLE ..is There?
As broadly interpreted, a housing bubble refers to an unsustainable gain in home prices. The premise is that a price bubble is at risk of “popping,” resulting in a loss of equity.

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Adjustable Rate Mortgage ARMs
Various types of adjustable rate mortgages and the differences between them.


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Balloon Mortgage
Balloon loans are short term mortgages that have some features of a fixed rate mortgage.

Resources & Links
Best Resource on The Web to Locate a Renter!
Colorado apartments, Colorado homes for rent, Colorado home rentals, Colorado vacation rentals, Colorado houses for rent, apartments in Colorado, and Colorado rental homes. Find apartments for rent, home and house rentals, condos for rent, apartment rentals, townhomes for rent, apartments, homes for rent, houses for rent, lofts and loft rentals. The list includes townhouses for rent, duplexes, rental property or properties, and other vacation rentals for rent in the Colorado area. Search for apartment rentals in CO, home for rent in Colorado, house for rent in CO, rent to own, and townhouses or a condo in Colorado. All rental listings are current and view them for FREE!


Investment Basics
Boot Exchanges
Having nothing at all to do with footwear,Boot is a term which refers to the items of personal property and/or cash that is necessary to even out an exchange. Boot is property which is received in an exchange and that is not like kind as to other property acquired in an exchange transaction.

Resources & Links
Boulder Real Estate Market Conditions
A thorough analysis of the Boulder metro market, as detailed, reveals that there is very little danger of this. In fact, the local housing market is in excellent shape with a potential for significant housing
equity gains, particularly for homebuyers who plan to remain in their house for the long run.


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Bridge Loan
A bridge loan as the name implies is a loan used to bridge the financial gap between monies required for your new property completion prior to your existing property having been sold.

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Built Green
As a mortgage professionals, and anative of Colorado. We enjoy the outdoors and our always willing to help protect our environment.

The great news is that the mortgage industry is now developing energy and environmental products that make sense for the consumer.


Summit County Market
Cities in Summit County Colorado
Real Estate Information on Cities located in and around Summit County Colorado.

Investment Basics
Closing Costs
Exchangers, closing agents, escrow officers and tax advisors have struggled with the many issues presented by the variety of expenses and cash payments associated with closing the properties in an exchange transaction.

Resources & Links
COFI Index


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Colorado Certified Public Account
Professional Competent Advisor Serving Businesses and Individuals.

Resources & Links
Colorado Foreclosure Process
As Colorado continues to be one of the States hit hard with home foreclosures the public needs to be aware of the scammers and their tricks. Freddie Mac the governmental organization that purchases mortgages from the banks has produced an informational video to get the word out.

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Colorado Home Appraisals
Our vision is to provide you with a professional appraisal service, and to extend our best effort to ensure each appraisal achieves excellence. - Robin Schellman

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Colorado Homes
Real Estate Colorado.Net opens the door to Colorado's Real Estate market with over 50,000 active property listings. These Colorado properties and real estate listings are uploaded directly from the Colorado MLS, with thousands of resources for Home Buyers and Sellers

Resources & Links
Colorado Water Law
Buying that perfect mountain or ranch in Colorado? Make sure you understand your water rights!

Types of Exchanges
Combining Seller Financing
Combining Seller Financing with Tax Deferred Exchanges
In most cases, it is preferable for the seller (Exchanger) to receive all cash for the sale of the relinquished property. However, many real estate sale transactions require the seller to "carry back" a part of the purchase price as financing to assist the buyer in purchasing the property


Investment Basics
Converting a principal residence to a rental property and later sell it and benefit from both IRC 121, IRC 1031
REVENUE PROCEDURE 2005-14

A property owner can convert a principal residence to a rental property and later sell it and benefit from both IRC 121 (principal residence tax exclusion rules) and IRC 1031 (investment property tax deferred exchange rules). Property owners must comply with all the rules in both sections to qualify.


Types of Exchanges
Converting a Rental to a Residence
CONVERTING A RENTAL TO A RESIDENCE:
MANY TAXPAYERS CAN TAKE ADVANTAGE OF TWO TAX CODE SECTIONS.


Resources & Links
Creating Wealth in Real Estate
Three out of four homeowners say their "home wealth" is greater than their "stock wealth."

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Credit Blimished Borrowers-Home Ownership Possiable?
In a lot of cases an experienced Mortgage Banker can help credit-blemished borrowers obtain home financing.

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Dealing with Real Estate Brokers & Agents
An agent with fast sale times in relation to the others; an agent who sold homes at prices close to the listing prices; and an agent with a high list-to-sales ratio. Be sure to inquire exactly how the agent plans to market your home.

Investment Basics
Delayed Exchange Deadline
The Delayed Exchange
There is a common misconception that all tax deferred exchanges are complicated and require all properties, relinquished and replacement, to close concurrently. Fortunately, the most common exchange variation, the delayed exchange (also referred to as a deferred or Starker exchange, Starker v. U.S., 602 F.2d 1341),




Investment Basics
DisQualified Parties and Legal Counsel as Accommodator
Your Attorney as Accommodator...Why this can Jeopardize the Exchange!

Investment Basics
Do's and Don'ts 1031 Exchanges
Do advanced planning for the exchange. Talk to your accountant, attorney, broker, lender and Qualified Intermediary. If you miss your identification and exchange deadlines. you will disqualify the entire exchange. No Exceptions period!

Investment Basics
Exchanging With a Related Party
Exchanges between related parties are allowed but the Exchanger must follow specific rules before the exchange will qualify for tax deferral. Related parties are defined in IRC 267(b) and 707(b)(1)

Resources & Links
Fannie Mae Mortgages
Fannie Mae helps families acheive the American Dream of home ownership.

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FHA Mortgage Insurance
Programs that help low and moderate income families become homeowners by lowering some of the costs of their mortgage loan.

Resources & Links
Freddie Mac
Freddie Mac is a stockholder-owned corporation chartered by Congress in 1970 to keep money flowing to mortgage lenders in support of homeownership and rental housing.

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Get Your Home Ready To Sell
Buyers pay a premium for a home that is in top-notch, move-in condition, so once you decided to sell, make sure the home is ready to be sold

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Ginnie Mae
Ginnie Mae's goal is to support the expansion of affordable housing in America.

Resources & Links
Graduated Payment Mortgages (GPM)
The GPM is an alternative to the conventional adjustable rate mortgage, and has a fixed note rate and payment schedule.

Resources & Links
Hard Money Loans
Hard money loan criteria varies from one lender to another. The more flexible the lender is about the terms, LTV (loan to value), financial qualifications, etc., the higher the risk to the lender and therefore the higher the rates you will pay.

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How to Buy a HUD Home
What is a "HUD Home"?
Answer: When someone with a HUD insured mortgage can't meet the payments, the lender forecloses on the home; HUD pays the lender what is owed; and HUD takes ownership of the home. Then HUD sell it at market value as quickly as possible.


Elements of an Exchange
How to Initiate an 1031 Exchange
Find an experienced professional QUALIFIED INTERMEDIARY to assist you with the exchange as early in the sale process as possible.

Resources & Links
I Am Interested in 1031 Tax Exchange
RealEstateColorado.net is a Full Service Real Estate Brokerage structured towards a client-centered approach to helping you achieve your real estate investment goals and solving real estate problems associated with owning investment property.

We work to protect our client's assets through our team of experts whose specialized services can defer capital gain taxation indefinitely.

Click Here to Contact Us About 1031 Exchanges


Types of Exchanges
Installment Sales
An installment land sales contract (also known as a contract for deed or a contract of sale) is an agreement between the Seller and the Buyer for the purchase of real property in which the payment of all or a portion of the purchase price is deferred.

Resources & Links
Interest Only Mortgages
Interest only products are an easy way to save money and a very popular alternative to traditional fixed rates but they are not without risk. An "Interest Only" loan can offer consumers greater purchasing power, increased cash flow and a number of other benefits which are listed later in this article.

Resources & Links
Interest Rate Buydowns
The most common buy down is the 2-1 buy down. In the past, for a buyer to secure a 2-1 buy down they would pay 3 points above current market points in order to pay a below market interest rate during the first two years of the loan. At the end of the two years they would then pay the old market rate for the remaining term

Resources & Links
Lenders Are Required to Disclose Terms
The Homeownership and Equity Protection Act of 1994 was enacted to offer consumers protection regarding certain home-equity loans that may charge high interest rates and high fees. This act does not limit the finance charges or rates that may be imposed on such loans, but it requires lenders to offer several disclosures to potential borrowers making them fully aware of the the applicable loan terms.

Resources & Links
LIBOR Index


Investment Basics
Like Kind and Foreign Property
To qualify for tax deferred exchange treatment under IRC 1031, the relinquished property must be exchanged for replacement property that is of like-kind?.

Investment Basics
Limitations on the Safe Harbor
The 1991 Treasury Regulations for tax deferred exchanges under IRC 1031 establishes four safe harbors, the use of which allow a taxpayer (Exchanger) to avoid actual or constructive receipt of money or other property for purposes of completing a 1031 exchange.

Resources & Links
Mortgage Debt Consolidation
Debt consolidation is taking out a big loan to cover one or more smaller loans. In essence, you borrow an amount of money large enough to pay of the loans you have.

Resources & Links
Mortgage Down Payment
There are several ways buyers, including first time home buyers can obtain down payment assistance.

Resources & Links
Mortgage Terminology Defined
I have complied a list of terms used in the Mortgage Industry and defined them for you.

Types of Exchanges
Multiple Asset Exchange
Many times exchangers own property that consists of both real and personal property, such as a hotel or restaurant. An exchange of such a multiple asset property creates issues when trying to allocate the various assets into their proper like-kind categories using a property-by-property comparison.

Resources & Links
Negitive Amortization Loan
Negative amortization occurs when the monthly payments on a loan are insufficient to pay the interest accruing on the principal. The additional interest expense is added to the loan balance.

Investment Basics
New Principal Residence
Section 121 of the Internal Revenue Code allows exclusion up to $250,000 of the capital gain on a principal residence for single taxpayers and $500,000 for a married couple filing jointly.

Investment Basics
New Tax Law Effective 10-22-2004
On October 22, 2004, President Bush signed into law corporate and foreign tax legislation that also contained a provision affecting IRC 1031. Five Year Combined Hold Period Required to Exclude Gain Under IRC 121

Exchange vs. Sell
Non-Tax Reasons for a Tax Free Exchange
There are many additional underlying reasons an investor might want to exchange one property for another. The motives often fall along standard risk-reward or cash flow-appreciation scales.

Types of Exchanges
Other Interest in Property
In addition to a fee interest in real property, certain other interests in real property may be exchangeable as replacement property.



Types of Exchanges
Partnership,LLC and REIT Issues
In general, exchanges of partnership interests are excluded from non-recognition treatment under IRC 1031(a)(2)(D), as enacted in the Tax Reform Act of 1984.

Types of Exchanges
Personal Property Exchange
Deferring capital gain and other taxes through an IRC 1031 tax deferred exchange is also available for personal property held for investment or for productive use in a trade or business.

Types of Exchanges
Property Held for Resale
The intent by the taxpayer to hold property "primarily for sale" will prevent the property from qualifying for IRC §1031 treatment. Over the years the courts have struggled with this exclusion from tax deferred exchange treatment.

Resources & Links
Raising Credit Scores
Below, we have outlined the most important steps for raising your credit score. Good credit and a healthy credit score are very important. If you want to buy a house, a car or obtain a credit card, all investors will want to know your creditworthiness.

Mountain Resource
Real Estate Resource


Resources & Links
Real Property vs. Personal Property
The general rule is, "if it attached to the structure or the ground, it is real property and stays with the house."

Resources & Links
Reasons For a 1031 Exchange
The Qualified Intermediary provides the following important services: Shields parties (Exchanger, buyer and seller) from certain liabilities; Ensures the preservation of safe harbor

Types of Exchanges
Refinancing Before and After the Exchange
Refinancing to pull equity out of a property prior to or after completing a tax deferred exchange can result in a taxable transaction under the "step transaction doctrine."

Investment Basics
Rent Back Option for Buyer's and Seller's
One option would be to delay the closing until the sellers can move in to their new home. However, it may be advantageous to the sellers to close earlier. This way they have cash in hand and don't have to worry about whether the sale will close.

Resources & Links
Reverse Mortgage-Home Equity Loans
A reverse mortgage is a special type of loan made to older homeowners to enable them to convert the equity in their home into cash.

Resources & Links
Section 121. Exclusion of gain from sale of principal residence
Gross income shall not include gain from the sale or exchange of property if, during the 5-year period ending on the date of the sale or exchange, such property has been owned and used by the taxpayer as the taxpayers principal residence for periods aggregating 2 years or more.

Resources & Links
Section 1033 Involuntary Converstions
If property (as a result of its destruction in whole or in part, theft, seizure, or requisition or condemnation or threat or imminence thereof) is compulsorily or involuntarily converted Into property similar or related in service or use to the property so converted, no gain shall be recognized.



Resources & Links
Streamline Refinancing for FHA Mortgages
FHA has permitted streamline refinances on insured mortgages since the early 1980's.

Investment Basics
Structuring Co-ownership of Rental Real Estate for Future Tax-Deferred Exchanges.
Structuring Co-ownership of Rental Real Estate for Future Tax-Deferred Exchanges.

Resources & Links
Subprime Loans
Programs for those that have less than perfect credit.

Resources & Links
Sucessful Steps to a Tax Deferred Exchange
9 Sucessful Steps to a Sucessful Tax-Deferred Exchange

Summit County Market
Summit County Communities
Information on Summit County Communities

Summit County Market
Summit County Subdivisons


Summit County Market
Summit County Water & Sewer Districts


What is a 1031 Exchange?
Tax Deferred Terms
As with any other specific area of real estate law, tax deferred exchanges under IRC §1031 have their own language,

Types of Exchanges
Tax Deferred Vacation Property Exchange
Do They Qualify for Tax Deferral? What About Second Homes?
Property owners throughout the nation are obtaining
the benefit of full reinvestment of equity under Internal
Revenue Code §1031.


Investment Basics
Tax Season Issues
Exchangers must report their exchange on the tax return for the year in which the exchange begins. The exchange is reported on Form 8824, Like-Kind Exchanges.

Exchange vs. Sell
The 1031 Tax Deferred Exchange
The tax deferred exchange, as defined in Section 1031 of the Internal Revenue Code of 1986, as amended, offers investors one of the last great opportunities to build wealth and save taxes.


Resources & Links
The Best Time to Buy Real Estate?
Are you a serious home buyer? If you are, get ready for the best time of the year to purchase.

Types of Exchanges
The Build-To-Suit 1031 Exchange
5) unit exchange, also referred to as a construction or improvement exchange, gives the Exchanger the opportunity to use all or part of the exchange funds for construction of the replacement property and still accomplish a tax deferred exchange.

Types of Exchanges
The Delayed 1031 Tax Exchange
There is a common misconception that all tax deferred exchanges are complicated and require all properties, relinquished and replacement, to close concurrently

Mountain Resource
The Real Estate Investor Resource
Articles written by RealEstateColorado.Net,Inc.,designed to be informative for real estate investors who are considering selling thier investment property located in Breckenridge Colorado and surrounding Summit County Colorado.

Types of Exchanges
The Reverse Tax Exchange
A reverse exchange is the flip side? of a deferred (delayed) exchange. In a reverse exchange the Exchanger for various reasons must acquire their like-kind replacement property before disposing of a relinquished property.

Elements of an Exchange
The Role of the Qualfied 1031
The use of a Qualified Intermediary is essential to completing a successful IRC 1031 tax deferred exchange.

Types of Exchanges
The Simultaneous Exchange
The Qualified Intermediary provides the following important services: Shields parties (Exchanger, buyer and seller) from certain liabilities; Ensures the preservation of safe harbor treatment under the 1991 Treasury Regulations; Provides a paper trail validating the flow and structure of the transaction; and Reduces the agent and closing officer's liability for the exchange structure.


Resources & Links
VA Loans
Special programs available to those who qualify by military service.

Investment Basics
Vesting Issues
To qualify as an exchange under IRC Section 1031 title to the replacement property must be held in the same manner as title to the relinquished property.

Resources & Links
What is Wear & Tear on Your Rental Property?
Information contained on this page are based on the experiences of our team as well as the many Landlord Tenant manuals published by the various State, County, and City Courts. Additionally, there are many public records that record decisions by the courts on Normal Wear and Tear cases across the country.

Investment Basics
What Property Qualifies for an 1031 Exchange
To qualify for a tax deferred exchange under IRC 1031 both the relinquished and the replacement properties must be held by the Exchanger for investment purposes or for productive use in their trade or business?.

Elements of an Exchange
What We Do for Clients
Laying the proper groundwork before you or your clients enter into a tax deferred exchange for an investment property is essential to making the sale/s run smoothly.



Resources & Links
What You Should Know About Mold
Potential health effects and symptoms associated with mold exposures include allergic reactions, asthma, and other respiratory complaints


 

The Colorado Home Source Team
Cherry Creek Properties

Phone: 720-515-6246 (MAIN)

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Copyright © 1998, All Rights Reserved

Latest Articles
What is a 1031 Exchange?
1031 Tax Deferred Exchange Law
Tax Deferred Terms
Elements of an Exchange
How to Initiate an 1031 Exchange
The Role of the Qualfied 1031
What We Do for Clients
Types of Exchanges
Combining Seller Financing
Converting a Rental to a Residence
Installment Sales
Multiple Asset Exchange
Other Interest in Property
Partnership,LLC and REIT Issues
Personal Property Exchange
Property Held for Resale
Refinancing Before and After the Exchange
Tax Deferred Vacation Property Exchange
The Build-To-Suit 1031 Exchange
The Delayed 1031 Tax Exchange
Exchange vs. Sell
Non-Tax Reasons for a Tax Free Exchange
The 1031 Tax Deferred Exchange
Investment Basics
Boot Exchanges
Closing Costs
Converting a principal residence to a rental property and later sell it and benefit from both IRC 121, IRC 1031
Delayed Exchange Deadline
DisQualified Parties and Legal Counsel as Accommodator
Do's and Don'ts 1031 Exchanges
Exchanging With a Related Party
Like Kind and Foreign Property
Limitations on the Safe Harbor
New Principal Residence
New Tax Law Effective 10-22-2004
Rent Back Option for Buyer's and Seller's
Resources & Links
1031. Exchange of property held for productive use or investment
Conventional Loan Financing
Home Warranty Can Save You Hundreds!
A HOUSING BUBBLE ..is There?
Adjustable Rate Mortgage ARMs
Balloon Mortgage
Best Resource on The Web to Locate a Renter!
Boulder Real Estate Market Conditions
Bridge Loan
Built Green
COFI Index
Colorado Certified Public Account
Mountain Resource
Real Estate Resource
The Real Estate Investor Resource
Summit County Market
Cities in Summit County Colorado
Summit County Communities
Summit County Subdivisons
Summit County Water & Sewer Districts