1031 Tax Strategy, LLC, and Self Directed IRA OH MY!

[Jeffrey Mayer]

Hey BP'ers,

I have a few questions regarding the tax/ income implications of some buy and hold real estate. I want to emphasize that these questions will be centered around buy and hold which is why I am beginning a new topic.

I read every where about the tax strategy using the 1031 exchange to defer capital gains tax, under the circumstances does it make sense to purchase & sell long term, 3 year minimum B&H investments, using this strategy. Additionally would there be any counter points due to the cash flow. My thoughts would be that at some point I might want to see the property so if we could limit the capital gains this would help but I am not sure of any harm this strategy would cause.

When seeking out a tax professional do I need to focus on somebody in my state or are CPA's well versed enough to be able to operate over party lines.

Lastly, are the only real advantages of using an LLC the benefit of limiting your liability to your business only. Or , are there other advantages to the LLC. It has been described to me as a "Pass-Through" entity many times which is why I ask the question.

Hope everyone has a great day!