All Forum Posts by: Joan MacDonald

@Account Closed, commenting so I receive updates on this event. I'll be in the area all of next week. I assume you are talking about a meetup on the evening of Tues November 9, correct? Wednesday would be better (I know, someone always has to say that!) but I'll try to come for Tues. Thanks.

@Dave Foster @Scott Wolf @Sheri Ottosen, if the property named within the 45 days on a 1031 exchange falls through, can the buyer change to a different property? Asking a different way- can a potential property be input as a placeholder for the 1031 and after the 45th day (but before 180 days) another property is purchased? I messaged all of ur replies to my friend and (once she's finished working) she'll potentially contact those of you with businesses. Thank you

Posting for a friend (like, really I am). She needs strategies to avoid capital gains for a sale coming up in a few days. Owner is a NY resident. Subject property is a condo in CO. Sale date: Monday Nov 8, 2021. Ownership since 2010. Owner-occupied for 6 years. Rental for 6 years. Never took depreciation or upkeep/capital improvement expenses on schedule E but always claimed full rent income. Owner wants to avoid capital gains in any way possible but she has no prospective properties for 1031 exchange. So she's researching extensions to 1031 exchange due to covid, self-directed IRA setup, conveying the property into an existing regular 401k before the sale. The issue is the short time period before the closing. Thanks in advance for thoughts on avoiding cap gains!

I had this mindset many years ago too.

1. From a practical standpoint, my wise Mom (a landlord/investor for many decades) said this to me: You're the one taking all the risk to hold this property. You're the one who sacrificed, saved,  and forewent other opportunities that might've been more fun so you could rehab a kitchen, etc. You're the one managing all of the details, committing your discretionary cash to keep up with taxes, insurance, etc. You're the one putting parts of your life on hold to build this investment. This is not about who deserves good things (everybody does). It's about who's actually doing the work for this dream (you!)

2. From a spiritual standpoint, it's a disservice to them to enable non-paying renters. They can't continue to live in the town they're living in now if they get used to paying less in rent each month. They'll try to move and can't find another place for the price they're used to. Then that becomes your problem too, except that now it's a problem that you can't solve for them. They have to solve it buuuttt they've complacently decided that they don't need to solve the problem of paying rent because you let them get away with it. Put up the boundary and allow them to find their way. It's better for everyone if you have faith that they can do it.

Attn: I don't need a lender because I already have one. This post is only about the strategy of moving a 50/50-held personal asset to an LLC-held asset, including a mortgage. The purposes are to buy out my partner + have the LLC hold title.

I own a residential investment property in CT with a partner. The title is in our personal names. I'm getting a mortgage to buyout my partner. This mortgage must be held by an LLC (and I prefer that). I can start my sole-member LLC today thru CT-SOTS anytime.

Is it possible to quit-claim the property to the LLC 1st and get the mortgage after that? Is it better if I start the LLC using specific language knowing it's being established for the purpose of holding this asset/house? I usually use the "any allowable activity.." language when starting an LLC but please advise if more is needed. I fully expect the LLC to be held in an IRA in the future. (Oh geez, should I establish that first?)

It's best if I personally did not hold a mortgage on this property in my name, even for 1 day. Also, I'd like to avoid conveyance tax. Thanks in advance.