All Forum Posts by: Ari Newman

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 Hi Ashish,  you know that I never sell anything!  I keep meeting investors that are telling me about all the money they are making on their wraps...I'm trying to caution them about having enough cash available to pay the tax on all the gain now in case they get audited.  

A question to all the tax pros; how are you guiding your clients when their R.E. activity has the potential to generate phantom income?  

I'm seeing lots of Gurus promoting and teaching about buying Sub-2 and then selling on a wrap.  Other past promoters sold a similar strategy by wrapping contract for deed, installment sale, Lonnie Deals (personal property), etc.  Clearly, there was never any intention to hold these assets for investments.  It would be hard not chuckle during an audit when buying/selling so quickly in volume is clearly dealer activity.  So someone, please clarify what am I missing?  I'm not talking about the entities that buy/sell one or two deals and year but rather those that use these methods as their business model thinking they are eligible for installment sales treatment.

@Levi Eubanks I used this strategy in 2019 with another investor and also added an Option to buy back.  
I used my 1031 funds and purchased her home below market value.  I gave her a Master Lease so that she continued to rent to her tenants and paid me rent.  I also gave her an option to buy back $5K below the purchase price AFTER 365 days.  That would allow me to exchange out of the property into my next one.  If you'd like to discuss more feel free to send me a DM.

Ari 

I'm trying to determine how holding time can affect tax implications in the following scenario.

I purchased a piece of land 10 years ago for $20K and held it for investment purposes.  The land is now worth $100K.

I find an undervalued home that I can purchase for $200K but fixed up will sell for $400K.

I purchase the house by selling the land for $100K; the proceeds go to my QI.  I add $100K cash to this and my QI purchases the new house for $200K.

Ignoring depreciation for this exercise, we can say that my basis in the new house is $120K. (basis of the relinquished land + cash added)

I spend $5K fixing up the house and 2 weeks later sell it for $400K.  Ignoring depreciation recapture and transaction costs, I'm looking at a gain of $280K. 

So the question is, would this be taxed at Long Term Cap gain rates?  Did my holding period in the land (10 years) transfer over to the new property with my basis?

Ari

Does anyone in the group have extensive experience using list automator and exporting/importing Data and filtering marketing lists? I can't find much support on these processes and would be happy to take someone to lunch who can give me an overview.
Thanks,
Ari

Exactly.  Typically handwriting the first letter and hand addressing the envelope and using 1st class stamp.

Can anyone recommend an online solution for direct mail marketing?  Ideally, the app would allow me to import my lists, skip trace, print a sequence of letters, keep track of which one was printed and what's next to print, etc.  I'm using REIBB for lead management and follow up but need a compatible solution for outbound marketing.  What are you using ?

thanks,

got it, thanks.

@Brian Eastman Thanks for your reply. If the GP owned a greater than 50% interest in the entity, would he then be disqualified to me personally and the other IRA accounts? I'm trying to understand some of the language in IRC 4975(e)(2)