Are you thinking about selling an investment property? If so, why not consider a 1031 Exchange? It’s the best way to avoid paying capital gains taxes on investment property when it’s sold.
In this article we will provide you with more information about 1031 Exchanges and how they can help you.
Is A 1031 Exchange Right for You?
Warning: Special rules apply when the depreciable property is exchanged in 1031. It can trigger a gain known as “depreciation recapture” that is taxed as ordinary income. In general, if you swap one building for another building you can avoid this recapture. But if you exchange improved land with a building for unimproved land without a building, the depreciation you’ve previously claimed on the building will be recaptured as ordinary income.
Such complications are why you need professional help when you’re doing 1031. Still, if you’re considering a 1031 – or are just curious – here are 10 things you should know.
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For professional property management in the Central Valley contact RPM Central Valley today by calling us at (209) 572-2222 or click here to connect with us online.