Rental Property Investor · Los Angeles · Member since 2019 · 146 posts · 101 votes
I know its of the items National Association of realtors is asking of the government. They are powerful lobby group in Washington and I feel like they could have some sway. There is also revenue procedure 2007-56, which may allow for an extension for disasters. It's clear if they this would take affect in this situation. I think we are wait and see what the government does. I have 43 days to select something and I hope they extend it.
Professional · Stowe, VT · Member since 2017 · 15 posts · 13 votes
6y
Great question. Speaking from the seat as a Qualified Intermediary who is in the midst of numerous exchanges for clients right now, a question that I am receiving every day. As of now, no guidance from the IRS has been received. We are operating under the premise that timelines for exchanges will not be extended and encouraging our clients to do the same.
Professional · Stowe, VT · Member since 2017 · 15 posts · 13 votes
6y
Great question. Speaking from the seat as a Qualified Intermediary who is in the midst of numerous exchanges for clients right now, a question that I am receiving every day. As of now, no guidance from the IRS has been received. We are operating under the premise that timelines for exchanges will not be extended and encouraging our clients to do the same.
Rental Property Investor · Los Angeles · Member since 2019 · 146 posts · 101 votes
6y
@Chris Brown thank you so much for your response. I will refer to your website. I'm in middle of the my exchange but I am preparing to take the tax hit if necessary.
Rental Property Investor · Member since 2020 · 15 posts · 5 votes
6y
@Jonathan Barr
I am in the same boat, my 45 days are up 4/18. Hoping for an extension.
Remember that the intermediary must hold the funds for the entire 180 days before returning.
I am also thinking of taking the 15% capital gains hit...I don't see how I would be able to find a long term rental tenant in an environment where evictions are not permitted, realtors can't show homes in person in certain places, and many folks are out of work, shrinking the pool of potential renters.
Rental Property Investor · Los Angeles · Member since 2019 · 146 posts · 101 votes
6y
@Kevin Lisewski I didn't know the intermediary would need to continue hold it for 180 days. I will check with my intermediary on that. My capital gains tax hit will be higher because I'm in California. The good thing is lived in one of the two units 2 out of the last 5 years. So basically 1/2 the gain will be tax free. The hit won't be as bad but it'll still sting.
Rental Property Investor · Member since 2020 · 15 posts · 5 votes
6y
@Jonathan Barr
I don't think the 1031 rules vary by state, as they are federal. My intermediary said if the funds go unused they are obligated to hold them for the entire 180 days. It's worth double checking.
I forgot that the state will want their chunk of capital gains as well, I am in NJ.
Specialist · New York City, NY · Member since 2019 · 53 posts · 28 votes
6y
@Jonathan Barr assuming the rules don’t change and no extension is granted let me know if you run into a 45 day ID jam. May be able to help. Best of luck and stay safe everyone! 🙏
Rental Property Investor · Oklahoma City, OK · Member since 2017 · 1k+ posts · 694 votes
6y
@Jonathan Barr it might be worth looking into properties where the inspection reports are provided upfront. With that, you can negotiate when you sign and just wait for an appraisal! Should have everything wrapped up in 2 weeks. Are you replacing in LA?
Rental Property Investor · Los Angeles · Member since 2019 · 146 posts · 101 votes
6y
I'm looking in the midwest mainly Kansas City for my replacement. I already bought a 14 unit apartment there. LA there is nothing that cashflows YET! I'm prepared to take to hit instead of trying to make something work that doesn't really work.