All Forum Posts by: James Boreno

Hi BP Fam,

See Imgur Link for Cracked Stairnose Photos

https://imgur.com/a/9jNzmrp

Installed Vinyl Stairnose in my rental about 6 Months ago, but my tenant sent me these photos that it's starting to crack. What do y'all suggest I do? It's a total of 14 steps, and I believe 3 are starting to crack.

1. 1) Should I replace the cracked stairnose with replacement vinyl stairnose and hope it doesn't happen again?
2. 2) Should I install carpet over the vinyl stairnose?
3. 3) Any other suggestions which are cost-effective as this unit is being rented to a tenant with a dog.

@Dave Foster Thank you for the response! However I've held the property since September 2023, so it's been about 4 Months now. Would I have to wait until 1 full year passes before conducting another 1031 Exchange or would I be able to do another one now? 

Hi BP,

Quick question, I completed a 1031 exchange on 9/2023 (about 4 months ago). I purchased a 6 Unit Multifamily as the replacement property and put about $150K in renovations into it. However, after thinking about it, I would much rather sell it because I'm not able to get the rental amounts I originally thought and I would much rather buy 2 duplexes so I have less of a headache. If I sold the property I would be looking at a profit of about $350K minimum. 

I was doing some research on google and also asked the 1031 exchange company, they said the IRS generally wants you to hold the replacement property for at-least 2-years before conducting another 1031 exchange, however that it's not a set rule, it's just recommended. I wanted to know if I would be able to conduct another 1031 exchange? This time I would buy 2 ready-made duplexes that are much easier to rent out with the proceeds.

Thank you for your time!

Hi Biggerpockets Fam,

My father and I just purchased an investment property - We hold title as Joint Tenants.

I wanted to know, if my father passes away, does 50% of the property get reassessed?

I was thinking maybe it's smarter to hold title in my parents revocable living trust, but then I thought Prop 19 came into effect and by the time I Inherited the property, it would get reassessed at 100% compared to 50% Reassessment if my father and I held title as joint tenants. Please advise if my thought process is correct here, thank you.

 @David M.

So we bought the property under the LLC in 2016

We Refi'd in 2021 to our trust

Then did a grant deed instantly back to the LLC after we closed the REFI

We sold the property while the title was in the LLC, however in 2020 the relinquished property was reported on personal tax returns

Hopefully this clarifies.

@David M.

The trust owns the LLC - Revocable Living Trust

No Mortgage interest deduction, property was bought all cash - Cash out REFI Loan was obtained in 2021

Mortgage Note was in my fathers name, the deduction will take place in 2021 tax returns, planning to file relinquished property on the LLC returns.

@Ronald Rohde

Relinquished property was initially acquired on the LLC. The property was then refinanced last year into the trust, but then my parents did a grant deed back to the LLC.

2019 - Relinquished property was reported on LLC Returns

2020 - Relinquished property was reported on Personal Returns

2021 - We are planning to report the relinquished property on LLC returns.

Our goal is to acquire the new properties in our personal name/trust for the title - While Successfully completing the 1031 Exchange.

 @Ronald Rohde

Got it. So what you're saying is basically if the property was sold under the title of the LLC and in the 2021 tax returns it was under the LLC Returns. The title for the new property can be in their personal names/trust but it would just have to be reported on their LLC returns for 2022 to keep that same EIN trend going?

@Dave Foster

Thank you Dave for your insight. I don't think my QI is very knowledgeable tbh, I will be reaching out to you on my future 1031 exchanges - just wanted to give you a heads up.

My parents spoke with their CPA and he said my parents LLC is not a disregarded entity as the LLC does indeed file taxes, however the relinquished property was filed under their personal tax returns for the year 2020. My CPA did indeed confirm that its fine that the vesting will be under my parents personal name or the trust, which is good news. I'm just a bit confused on how to be honest.

My parents filed all of their properties under their LLC in 2019, but in 2020 they filed under their personal. For their 2021 returns they are planning to file all the properties under the LLC again. Would this cause an issue?

From my knowledge and what I'm gathering from this, it all comes down to the TIN for the relinquished property. So in the future if my CPA files 2021 returns and reports all the properties in the LLC's return, but we want to sell one of our properties with the title of the LLC and do a 1031 exchange & purchase a new property under the trust or personal names, I'm assuming this will be an issue, no? Please advise at your earliest convenience. Thank you.

Adding to this:

The LLC is 95% in my fathers name and 5% in my mothers name. They are located in California, which is a community property state. After doing further research, I'm thinking the LLC is considered a disregarded entity, as my parents reported the relinquished property under their personal tax returns in 2020, however in 2019 they reported it under the LLC.

If my thought process is correct, since the property was reported on my parents personal tax returns in 2020 -  they were considered the tax payers for the relinquished property. I'm thinking we can close the new property under their personal name or trust. Is this true? Please advise.