All Forum Posts by: Steve Hungerford

 I'll have to look this up, I have heard this mentioned a few times recently.

Yes, it would be great if the IRS allowed this. They could tax you if you didn't invest the money on new development within a certain time frame. It would spur on new development. There is this big push for ADU's and affordable housing here in CA.

Thanks. I think I was misunderstanding something Dave said. I understand its the current value of the investment that is there that I can 1031 funds into. I had a notion that maybe I could 1031 into a potential future investment of the construction costs of the ADU. My bad for thinking this might be allowed.

There is a communication error here, I am not sure what you are saying Dave, I am talking about how they would place a value on an ADU that has not been built yet, my answer is they probably wouldn't.

I have no clue why/how you keep going back to talking about exchanging on land I already own ? Where are you getting this ?

I over and over keep talking about 1031 ing into a new investment where I would then develop an ADU on that land. The ADU is not there yet.

Can 750K in this example be allocated to the 1031 ? Since 500K is for the construction costs of the ADU and not spent yet ? We are looking at future construction costs. If it can be allocated up front like this, great but what happenns when we need the 500K cash to build the ADU ?

I wonder about the case where the ADU is not there yet, How they allocate say 1m to the investment side. Lets say the land needed for building the ADU is worth 500K and the ADU will cost 500K. Does that count for the 1m ? I would think they would have to calculate or come up with a number for the land value currently in that situation.

What I am interested in is the portions. How to make sure you are moving the 1031 money into the property sections, say an ADU. Is the ADU section worth the 1031 money that moves over. I know an accountant does his "art" work here. How does he calculate that the ADU is worth the amount coming over for an example. What if the IRS feels the ADU did not account for the 1m brought over (for example)

Also, does it always have to be for income producing rental income ? I am thinking lots of appreciation can come from improving a property. I think of an example of developing a large lot with a residential property on it by putting an ADU on it. That takes time but may improve the property value over time. I wonder if this is an option that can be shown to be acceptable.

 Interesting thanks. Thats too bad.

Hello,

Is the Section 121 250K/500K Capital gains exclusion likely to possibly go up ?


I was reading from the NAR website about a bill they are endorsing.

Before the House of Representatives left Washington on October 1 for the pre-election campaign season, a bipartisan bill of key importance to millions of homeowners was introduced by Representatives Jimmy Panetta (D-CA) and Mike Kelly (R-PA). Titled the “More Homes on the Market Act” (H.R. 9015(link is external)), the legislation would double the capital gains exclusion for sales of principal residences from $250,000 to $500,000 for single filers and from $500,000 to $1 million for married couples filing a joint tax return, and also index these amounts for future inflation. While this bill is unlikely to move in 2022, it is a great first step upon which we can build next year.

Hello,

Does Soquel, CA fall into one of the county designated areas ?

How long is the waitlist ?