All Forum Posts by: Jeff Nash

Connect with @Denver McClure.

Our tax firm as plenty of connections if you want some referrals.  Feel free to message me.  

Our tax firm as plenty of connections if you want some referrals.  Feel free to message me.  

Just like any investment option, and particularly with alternatives, you have to analyze qualitative factors like the management team, longevity of the business, track record, and diversification of the assets that make up the DST (ie concentration risk and where they are located). You should talk with your advisor as well as the sponsor to do your due diligence. There are several good ones out there that check all the boxes. Sorry to hear the ones mentioned have underperformed and communication has been poor. They can be a nice way to get passive income when you no longer want the inherent risks and operating challenges of owning real property directly.. When used in conjunction with a 1031 exchange, which is often the case, you will get the same tax benefits as with any replacement property (full tax deferral or partial with boot).

I 100% agree with the intent aspect and that is an important premise, but the fact is in this particular situation intent for it to be personal use has been confirmed (by way of a public post). If you opened the exchange with the intent to hold the property for investment, and then in the future circumstance changed which caused you to reconsider the use of the replacement property and convert it to personal use, then a period of time less than two years might be reasonable.  The original post leaves the door open for a challenge by the IRS, so the safe harbor of holding it for investment for two full years is the safer option.  

You can’t do an exchange and immediately move into the replacement property and use it primarily for personal use. The proceeds from the relinquished properties need to be used for investment purposes for a period of time; however, you can temporarily use it for investment purposes for 2 full years, after which you can convert it to personal use. Perhaps you could also purchase a duplex, for example, and use personal funds for the portion that you can live in and 1031 funds for the investment portion. I don’t know  the specific details of your situation, but there are other considerations and options as well.

@Chris Lane feel free to reach out.

@Stanley J Black can help.

@Jason Watson your comment above just recently came to my attention yesterday. I debated whether to even respond or chime in, but believe it is warranted as I took your commentary to be unnecessary, and I'll leave it at that. Characterizing @Denver McClure as a "strawman" is inaccurate and inappropriate.   

Based on my observation, I assume this post originated in the Tax and Legal Issues forum rather than the Classifieds. I understand the self-promotion rules and their purpose, but in this type of situation the rule is out of context and perhaps even trivial. BP personnel are supposed to otherwise redirect this type of seeking recommendation post and then whoosh …. an innocent response such as that made by @Denver McClure miraculously is within the rules. Amazing!

If you initially took the time to respond to this post as a tax professional by explaining this self-promotion technicality (as I have myself done in the past on similar posts), you could easily argue that this action alone can be construed as self-promotion, depending on your interpretation of the definition. Self-promotion to me insinuates that you are vehemently announcing that you possess some special skill or product/service that perhaps others do not, and/or you are trying to differentiate yourself to gain a competitive advantage, whether fair or unfair.

I understand that you have been on BP for a month, but probably have recognized that @Michael Plaks has long tenure and made significant contributions over many years, perhaps since inception of BP. His many articles and white papers are highly effective in addressing the myriad of repeated questions that seem to be asked one way or another by many posters. I have found myself just responding to several posts to "ask @Michael Plaks", as I highly doubt there is a topic that he has not been able to address over time. I say all this to demonstrate respect for my/our peers on BP and also to align with Michael’s sports analogy comment. I would also note that I view BP more like the NCAA, so interpret that how you may!  

I respect you and many other knowledgeable peers on here, who I know are working hard to help, albeit not entirely gratuitously (this is not Dear Abby).  Time is our value.

Glad to help Jarrod!  Making the transition from an employee to a business owner is very hard work but rewarding in the long run.