All Forum Posts by: Naseer Khan

A 1031 exchange sounds like a good idea if you don't need the cash. I would exchange the condo for an SFR in the Bay Area, so you are not paying those crazy HOA fees. Alternatively, you can seller finance to someone so that the income is coming to you in installments (installment sale). This way you only pay capital gains tax on the amount that is received each year rather than taking a big hit all at once.

A 1031 exchange sounds like a good idea if you don't need the cash. I would exchange the condo for an SFR in the Bay Area, so you are not paying those crazy HOA fees. Alternatively, you can seller finance to someone so that the income is coming to you in installments (installment sale). This way you only pay capital gains tax on the amount that is received each year rather than taking a big hit all at once.

A 1031 exchange sounds like a good idea if you don't need the cash. I would exchange the condo for an SFR in the Bay Area, so you are not paying those crazy HOA fees. Alternatively, you can seller finance to someone so that the income is coming to you in installments (installment sale). This way you only pay capital gains tax on the amount that is received each year rather than taking a big hit all at once.

A 1031 exchange sounds like a good idea if you don't need the cash. I would exchange the condo for an SFR in the Bay Area, so you are not paying those crazy HOA fees. Alternatively, you can seller finance to someone so that the income is coming to you in installments (installment sale). This way you only pay capital gains tax on the amount that is received each year rather than taking a big hit all at once.

A 1031 exchange sounds like a good idea if you don't need the cash. I would exchange the condo for an SFR in the Bay Area, so you are not paying those crazy HOA fees. Alternatively, you can seller finance to someone so that the income is coming to you in installments (installment sale). This way you only pay capital gains tax on the amount that is received each year rather than taking a big hit all at once.

A 1031 exchange sounds like a good idea if you don't need the cash. I would exchange the condo for an SFR in the Bay Area, so you are not paying those crazy HOA fees. Alternatively, you can seller finance to someone so that the income is coming to you in installments (installment sale). This way you only pay capital gains tax on the amount that is received each year rather than taking a big hit all at once.

@Lucy Balyan - Hi Lucy - I'm sorry to hear about your troubles with the project. I imagine that it's stressful, especially since you're living in CA. The first thing that you may want to do (if you haven't already) is get some sort of agreement with the contractor that lays out the work that he plans to do along with the estimated costs for that work. If you or someone you know is familiar with construction, you can verify that the costs are reasonable. If this contractor is reputable, he would have provided you with a written estimate and agreement of terms, One thing to remember is that the contractor should not be doing any work that he did not provide an estimate for and that you did not approve. 

Unexpected work can can come to light after the initial work has began, which is typical if the house is in bad shape. I think you are making the right move by having another person take a look at foundation to make sure the additional work is legitimate. 

As for your current contractor, if he is reluctant to provide you a written agreement, or if the estimates seem high, or even if you are getting a bad vibe, I would have him stop working so that you can call another contractor (or two) to come out and give you another estimate. Or you can have him continue to work and have another contractor come out when he is not there. Then you can compare the new estimate with your current contractor's estimate to look for similarities and anything that seems out of the ordinary. You should always get estimates from at least 2-3 contractors before starting a project so that you can compare the estimates and look for unnecessary work/costs. 

If everything looks fine after that, then you should have some peace of mind that you are in good hands. If you find that he is ripping you off, have him stop working and ask for any money back that was not expended on the project. He is entitled to fair compensation for the work that he has performed but nothing else. Hope this helps. 

This response neither constitutes legal advice nor establishes an attorney-client relationship. Inquirers must seek the advice of their own legal counsel prior to undertaking any course of action related to this inquiry.

Thank you for the warm welcome everyone! 

An LLC can elect to be treated as an association taxable as a corporation by filing Form 8832, Entity Classification Election. And, once it has elected to be taxed as a corporation, an LLC can file a Form 2553, Election by a Small Business Corporation, to elect tax treatment as an S corporation. You basically get the best of both worlds - flexibility of structure from the LLC and tax benefits of the S corp. 

Hi Everyone - My name is Naseer Khan and I am an attorney, broker and investor in California and Florida. My law practice is dedicated to real estate investing. I help people with contract drafting, setting up business entities, tax help, investing legal advice, among other things. 

I hope to help fellow investors with legal and tax questions (I have a masters in tax law) and hopefully find investment opportunities where I can get the chance to connect with new people and explore new areas.