Selling Long-Term Rental Property to roll into Syndication

[Marcus Kuhnert]

First off, I have already contacted my CPA and am waiting to hear back, but thought I'd ask this crowd to see if there is anything to add-

My group plans to sell off some rental properties over the next few years - these are properties we have held for longer than one year.

We would like to use these proceeds and invest into syndications who would perform cost seg/depreciation.

My questions to the group are:  are proceeds from the sale of our rental properties considered "long-term capital gains and also passive"?

and will the cost seg/deductions from the syndications offset these "long term capital gains"?

Are these like-for-like types of gains and monies?

What am I missing?

[Evan Polaski]

@Marcus Kuhnert, generally speaking, your sale is long-term cap gains and passive, with some depreciation recapture in there.  Typically, a syndication investment is also passive, so any share of losses can be used to offset your gains.

I have done this several times over the last several years with the biggest difference being I owned my rentals personally, and invested in syndications personally. Not sure if the multi-member LLC/LP will create a different outcome for you and your group.