In my opinion, you need to assume you're going to have to pay the capital gains tax when you're comparing different scenarios.

Okay, let’s see how these same properties work for them, assuming everything else is the same:Essentially, they’ve created a $30k annual earned income on these 11 properties, which can be used to pay executive salaries, and passed on to shareholders as dividends—and they’ll earn another $300k in capital gains if nothing extraordinary happens--and remember, AH4R alone has over 50,000 homes in 22 states.It sounds like a license to print money.Risks do exist for these REITs, though.

Thomas Marshall I am sure it is, the challenge will be what position are you in 1st or 2nd and if your 1st then getting s lender to be in 2nd with 100% equity will not happen and then if your in 2nd your money is at high risk.If your looking to be passive either be a hard money lender or invest in mortgage notes.

I’d have so much depreciation recapture and capital gains it would be a real gut punch.

But this may be then most logical option I have 3) I am quickly approaching 45 days and rather than rush into something just pay the damn capital gains tax.

., Arms length to avoid a step transaction would involve retail sales which would cause a recognition of gain anyway. 

Look forward to learning more and to contribute to this awesome community.Thanks,RomelHi Romel, pleased to meet you.Decide which kind of investor you want to be (SFR, Commercial, Land, Tax Liens, Passive, HML, Multi-Family, Notes, Fix & Flip, Buy & Hold, “Subject To”, apartments, duplexes, assisted living, REOs, Foreclosures, Short Sales), etc.

The appreciation is based on the value, not the DP...and this works for both gaining and losing in appreciation. 

I think house-hacking a 2-3 unit property is a great way to gain acquisition experience, property management experience, lower your monthly living expenses AND possibly even live for free.Your next step should be to find a local investor-friendly realtor to discuss your goals.You'll then need to get pre-approved by a lender so that you know exactly which areas you can target.After you get that first deal, you can refinance after a year or 2, and move onto the next!

If no 1031 he would be on the hook for Recapture Tax on 50K, and Capital Gains on 100K, right?