All Forum Posts by: Rohnn Kostelecky

we have passive activity losses, how can we work that into an exchange?

real estate broker investor need cpa experienced in sales of rental properties including 1031 forward and reverse exchanges for consulting

why would we capitalize expenses when we are selling the house in 30-60 days, we certainly are not extending its life for our purposes.

we just had an eviction, the repairs cost 15,000+ a lot of it went on credit cards that I would like to get paid back from the sale which irs doesnt allow in an exchange. any ideas?

fixup expenses - carpet, paint, appliances - do not extend the life of the property, from what I understand they cannot be capitalized. and expensing them on the schedule E doesnt get the credit card paid off, i.e. we just paid 7600 to recarpet a rental prior to sale. and more expenses on the schedule E means more passive activity losses that we cant use. If this was just a normal transaction we could have the credit card paid at closing.

irs rules for a 1031 exchange are the most convoluted in the entire tax code, IMHO. Nobody "exchanges" a property and a mortgage for another property and mortgage, its usually always sell and buy or buy and sell. The most frustrating part is they do not allow any "fixup" expenses, yet almost everybody fixes up their property before they sell. How do you report fixup expenses?