All Forum Posts by: Russell Sherman

I will be selling a high gain single family residence in Los Angeles in the next 12 months or so and am considering putting part of the rollover into a multi-family in Columbus, where I now live.  Would anyone be willing to meet or talk to go over the market, what to expect, etc.  I live part time in Mexico but will be in Columbus for the next several weeks.

I should add I intend to roll the gain from the sale into DST's. I am not interested in having physical properties.

It sounds like cash out refinance is what I want.  The house was never refinanced and was paid off over ten years ago.  If I sold it in 2025 I would qualify for the $250,000 exclusion as it was my principal residence the last 30 months.  I’m aiming to 1031 the rest of the sales proceeds.  Ideally, I would like to buy something in San Miguel de Allende, Mexico  for personal use as well as short term vacation rentals.  

Before I get too far into the process I want to get an idea if this is even allowed per IRS.

I converted my former primary residence into a rental in 2022. Would I be able to take a home equity loan against this property to buy another property in Mexico? At some point I may want to sell the SFR? Is that permitted by the IRS? I purchased the SFR in the 1990's for $300k and estimate it's current value at about $1.5M. I would take around $300k in equity.

Thanks all.  Just wanted to make sure.  I will be exposed to significant Capitol gains tax if I overlook something

I am taking offers on a property I intend to do a 1031 with.  The realtor wants to use a local escrow company to hold the good faith deposit, although I want a different QI to handle the exchange.  Does the QI need to hold the deposit as well?  I don’t want to blow the exchange

As I look into DST's, I notice most brokers such as Cornerstone, Archer etc. are affiliated other firms such as Thornhill Securities Inc or Lightpath Capitol. Can someone explain this relationship and how it may effect my decision; fees, offering availability etc? Thank you.

Thank you.  As long as the IRS honors the divorce decree regarding the 1031 I am certain I qualify for the 121.  I have had a unique situation where I was a resident of both Ohio, where I had a farm and resided half the year, and also a resident of California working in the entertainment industry on a project by project basis.  I file income tax returns for both states. It is common for entertainment people to be considered part time residents.  I went back and counted days of use and easily met the requirement.  Hopefully the CPA will verify, as you pointed out.  If not, then I will exchange the entire proceeds.

I will continue to assemble a team.  The deed will be transferred next week and I will begin the process.  Thank you again.  

I have a single family house that was used as our primary residence, then held held as an investment rental after we moved into another home. The former residence was subsequently rented from 2018 to March 2021, when the tenant vacated. At that time my intent was to sell and use the 121 exclusion and 1031 the gain into DST's. However, at that time my former spouse sued for divorce and the court froze all assets while the divorce was pending. Last month the divorce decree was issued and I received the rental as part of the settlement.

How does the IRS treat property frozen by court order?  I clearly qualified for both the 121 and 1031 at the time the temporary court orders were issued.  I clearly intended to sell the property, listing it with a realtor twice.  Both times we received formal offers, but my former spouse and I could not agree on how to divide the proceeds.  However it has been over 12 months since it was rented due to the pending divorce.  Does that recharacterize the property from a rental?

I am waiting to hear from a CPA.  In the meantime, I want to assemble a team to help with my transactions, but I do not want to waste anyones time.  If I can’t do a like-kind exchange I won’t sell due to the capitol gains tax, over 500k.

The divorce decree lists the property as a rental, and when I transfer the title into my name it is recorded as a rental.  

Any thoughts?

I expect to sell a single family property that was held as a rental property in the next few weeks. I plan to roll the gain into several DST's and mineral rights.

As I research QI's I see companies such as Asset Preservation Inc. offering their services in conjunction with DST's. Do they offering broker services? I thought they merely held the funds.

If QI's do not offer brokering services, am I better off working with a RIA or a broker, such as Peregrine? I have not found a broker that deals in DST's as well as mineral rights. It seems easier to use one person to handle all the exchanges but maybe that is not possible.

Finally, whose responsibility is it to make sure all tax rules are followed?  As I ask tax questions (I qualify for rule 2005-14 allowing the combination of 1031 & 121 exclusion) I am told they are not legally allowed to offer tax advice and to talk to a CPA.  So do I need a CPA to watch over the QI?  

I'm trying to learn as much as possible as I narrow down various QI's and DST brokers. I am coming across alot of contradictory information.