Is there a 1031 Exchange in Your Future?

That is a question that I have heard an awful lot lately. Why 1031 exchanges and why now? I would like to share a few thoughts with you on this topic. As many of you know Section 1031 of the IRS tax code contains provisions which allows deferral of taxable gains when the proper conditions are met under the code. I am by no means a tax attorney or an accountant but in layman terms what it amounts to in its simplest form is a tax deferred event when you sell real property, provided that you purchase another property of equal or greater value and you do it according to the rules set forth by IRS to qualify for the deferral. The implications of this are staggering and can mean the difference of thousands of dollars in taxes and possibly millions in equity when even a little planning is done in order to qualify for this aspect of the tax code. Let me be the first to say that this kind of thing is highly technical and the details of any given transaction should properly be reviewed by your tax advisor, your attorney and the other professionals who make it their business to protect your interest and guide you in such matters. Having said that the 1031 rules are something that you may want to learn more about. I see this aspect of the tax code becoming more and more important in the future. For instance, if I were to ask your opinion of the direction of capital gains taxes in the future what would you say? Do you think they will go down? Stay the same? If you are like me you might believe that they have a very good chance of going up. Even if the legislators do nothing the sunset provisions under existing law will take affect within the months ahead and capital gains tax will automatically revert to 20%. I happen to think that there is pressure to drive it higher than that depending on the economy and political climate next year. All the more reason to learn how to use the provisions of Sec. 1031 of the revenue code. I had the privilege of sponsoring a series of webinars for my clients recently hosted by Bill Exeter of EXETER 1031. He did an amazing job of explaining many aspects of the code that allows for tax deferral on all types of transactions not normally thought of as qualifying transactions. If you would like more information about the opportunities provided under this provision of the tax code give me a call I will be happy to make a personal introduction to Bill Exeter, a consummate expert in his field and a man I admire as a true professional.

California Here I Come!

I recently spent four days in Palm Springs California at a national exchange meeting. It was a fantastic experience. I stayed in a hotel which had received the benefit of over 90MM in renovation costs. It was all done in a retro style with the intent to emulate the fifties or sixties. It was impressive. Most of the people that were there were professional investors, developers, principals and brokers from all over the country. In these trying times in the economy these are the folks that are still making things work and getting deals done. People often ask why I spend the time, money and resources to get myself to these events when it seems that they occur in so many disparate parts of the country. There are a host of reasons. The first relates to what I said earlier. The people that attend these events are the real deal. They are the folks that have the cash, have the property or have the expertise to make transactions occur that might otherwise never happen. They also happen to be of the highest integrity of anyone you will meet in the industry. The second is that I want to do all I can to help my clients with their real estate goals. I can't do that sitting at home at my desk waiting for someone to call on a sign. Especially in today's market! I feel strongly that getting out around the country and talking up their property in front of serious players is a big advantage to my clients and that is something very few brokers are capable or willing to do. Whether its IREX, KREE, NEC or SEC I try my best to be there for my clients!

Real Estate Exchange Sessions

One of the most productive uses of my time on behalf of my clients has been spent at real estate marketing sessions. What is a marketing session you ask? It is meeting where real estate professionals gather together for the sole purpose of presenting properties to qualified buyers and brokers representing qualified buyers from all over the country. This goes on for days! Every few minutes another presentation is made to the group and each presenter then asks if there are any takers. I am always amazed at the number of takers on the properties. Not every transaction consumates but if I can show my seller three offers to consider I feel that I am adding value by spending the time and money it takes to be here. This week (Oct 28th and 29th) I am attending the Indiana Real Estate Exchangers (IREX) meeting in Indianapolis. It is the largest such event in Indiana and is held every year. There are many of these sessions held through out the year in different parts of the country. The grand daddy of sessions are the national meetings held by the (SEC) Society of Exchange Counselors. Next month I will be attending the SEC meeting in Palm Springs California. There will be somewhere between 100 and 200 investors, brokers and other real estate professionals there. If you woulld like your property presented to real buyers who can perform call me! There is still plenty of time to get ready for that meeting with a custom marketing package put together by the Ruggieri Team.

To learn more about IREX click here: http://www.irexinc.org/bylaws.html