My plan was to unload the property before cap gains rates increase.

You will have gained much more knowledge and if you've invested wisely you will have more to invest with as well.

Originally posted by Steve Babiak:As Steven posted above, your friend should be contacting the QI for instructions on how to proceed so as to not jeopardize the tax-exempt status of the sale of the relinquished property.Just to clarify,1031 exchange only defers capital gain taxes, does not exempt them.

California is the poster child for out of control government spending, constant tax increases and fee increases to pay the tab.. and people should pay attention, because as the saying goes, as California goes, so goes the nation!

However it is gaining popularity heavily overseas, especially in South Africa.

. $30K, new property is $55K...If the selling price of the relinquished property is more than the price of the acquired property, the difference (neglecting transaction expenses) is your taxable gain ("boot" is the term used).

The most efficient way to handle this IMO is to pay have your friend hold a note or if he wants and equity position treat it as if he is holding a mortgage at an agreed rate of interest and you may even want to include him in on a percent of the gain if the property is sold.

If it falls thru, then there's nothing gained, and very little lost.Lynn (FL)

I think at best we may see small gains in some markets, but many will remain flat or continue to decline.

I am concerned because in case I want to sell the house at some point, I'd like to reduce my capital gains taxes as much as possible.