Case study Question, After-Tax Sale proceeds

[Uri Pearl]

Hey guys,

I'm working on a case study for an apartment complex. There is a loss on sale in the first 4 years and then a small gain on year 5. The case study analysis shows an increase in sale proceeds after-tax, meaning there was a gain in federal tax on sale. Is this a mistake? How is it possible for the after-tax sale proceeds to be greater than the before sale proceeds? I'm not really sure how this works.  

[Reuben Gathright]

In the real world, very few property tax sale investors would consider owning an apartment complex "tax title" for five years.  I suspect @Uri Pearl is discussing IRS taxes in respect to earnings on the apartment but still the thought of owning a tax title for 5 years is frightening to me.  :)

For any readers, this is why you make simple investment choices.  Don't let someone convince you that real estate options or short sales are a way to make quick cash.  The legal consultations and resulting fees must be weighed into your costs of ownership in these cases.