All Forum Posts by: Tina Lee

Thank you so much for your response.  

Thank you for pointing out the transfer of the deed.  No Anderson advisors never mentioned anything about transferring the deed to the trust, but the trust mentions the real property.  

I'm actually loosing about $200 monthly on this property and I don't make any income.  So I was desparate to get $800 CA franchise tax exempted and Anderson Advisors said that by forming a WY statutory trust, I can get exempted from that $800 CA franchise tax. 

Thanks again for your input!

I'm a WA resident and own one property in CA.  Anderson Advisors has formed a WY Statutory Trust for me for my property in CA.  I don't know what to do next.  My property manager is still taking out Franchise tax monthly and I'm neg negative $200/month and I don't know what to show them to stop them from taking that franchise tax from my proceeds.

1) Do I have to put my property to my WY statutory trust as I do with my other state properties to their LLCs?  Or does the WY statutory trust hold the property as it is?  I read the agreement and my CA property is in the trust agreement.

2) I asked Anderson Advisors what I can show/do to make my property manager stop taking out CA franchise tax monthly and they told me to fill out form 590.  However, on that form, there's no option for a trust as a reason for tax exemption.   Anyone know how to fill the form out?

I would really appreciate any step by step instructions/guidance on this.  Thanks!

I purchased my investment property in Nov 2021 as a 1031 exchange in Seattle.  I currently live in Visalia California but just got a job in Seattle and will be moving there in April.   It has been a challenge to rent out my investment property with cashflow since the mortgage is high but I currently have it rented out with some cash flow.   The current lease ends in April and I would like to move in to the property since  rent market has gone down significantly and it will be even harder to rent it out with cash flow.   I have consulted 2 lawyers and my CPA regarding moving into my 1031 exchange property and they have told me different things.

The tax attorney told me not to move in until 24 months from the purchase if I don’t have to and IRS will not challenge my 1031 exchange. He called it a “safe harbor”. So basically he told me not to move in until December this year which will be right after 2 years since the exchange and I will be safe even if I get audited. IRS won’t challenge me.

The real estate attorney told me that there is no such “24 months” rule. It’s best to not move into the 1031 exchange property at all cause the purpose of 1031 exchange is to buy an investment property, not for my personal use. So even if I move in after 2 years or 5 years, IRS will challenge me if I get audited. And unless I have a very good convincing reason ie like I lost my job, I will be asked pay the tax on the capital gain.

Does anyone know who is right?  I'm willing to wait until 2 years is over if "safe harbor" is true but if there is no such thing, I might just consider moving in there now and hope that I don't get audited.   

Thanks for all your responses!