First time investor about to do a 1031 exchange with 2.2 million...Help!
Greetings, I'm Nick. I inherited an auto repair business and property in Long Island City, NY. However, I'm not interested in running or maintaining the business. I'm currently in the process of selling the property and anticipate completion within the next six months. Although the property is valued between 2.6-2.9 million, I'm planning for 2.2 million. I'm seeking advice on investing this sum promptly, as I have limited experience in real estate. I'm open to collaborating with interested parties who can provide guidance or work with me on this venture.
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- Qualified Intermediary for 1031 Exchanges
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@Nikola Kiridzic, You're right. A 1031 will be needed. It will be your father who does the 1031 since he is the taxpayer for the property right now. I would recommend that you and he agree on a structure that allows you to manage and benefit from the 1031 replacement properties in a way that he can remain on title for the remainder of his life.
The reason for this is that if he passes away while owning the property you will inherit at a "step up" in basis - you will inherit as if you paid market price for the properties the day he died. So all of the tax built up over the years is actually wiped out when you inherit. This is the inheritance benefit that was referenced earlier. It could still be beneficial to you.
- Dave Foster
