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John DL Arendsen, Crest Backyard Homes "ADU" dealer & RE Developer (CREST "BACKYARD' HOMES, ON THE LEVEL General & Manufactured Home Contractor, TAG Real Estate Sales & Investments)

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Carol Williams
Although I'm retired, I love sharing my knowledge and learning from other real estate industry professionals. - Wenatchee, WA
Retired Agent / Broker / Prop. Mgr, Wenatchee, WA

Start looking for the exchange property early.  I've seen a lot of bad investments made because they were up against a deadline to buy.

Aug 26, 2016 11:51 PM
Rainmaker
4,800,082
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

I can tell you that there are a lot of folks doing some questionable ones.

Aug 27, 2016 10:03 PM
Rainmaker
2,781,113
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Find something you like and not just something that qualifies

Aug 27, 2016 04:50 AM
Ambassador
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Tammy Lankford,
Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668 - Eatonton, GA
Broker GA Lake Sinclair/Eatonton/Milledgeville

what are you selling to replace this property with?  

A 1031 exchange has little to do with current use of the property

It has to do with selling and replacing the property with a like property "investment for investment" property and the money can never be in your account and must be held in an approved account.

 

Aug 28, 2016 03:05 PM
Rainmaker
1,502,878
Ryan Huggins - Thousand Oaks, CA
https://HugginsHomes.com - Thousand Oaks, CA
Residential Real Estate and Investment Properties

John, from my understanding (in response to your comment on Carol Williams' answer) the replacement can be any type of investment, not just real estate.

Aug 28, 2016 03:53 AM
Rainmaker
634,482
Kathleen Luiten
Resort and Second-Home Specialist - Princeville, HI
Kauai Luxury Ocean Home Sales

I agree with Carol Williams that bad investments are common when people are too close to their purchase deadline. Start early!

Aug 27, 2016 06:24 PM
Rainmaker
4,319,419
Praful Thakkar
LAER Realty Partners - Andover, MA
Andover, MA: Andover Luxury Homes For Sale

John DL Arendsen - I'll still rely on what the CPA says!

Aug 27, 2016 03:13 PM
Rainmaker
4,272,548
Paul S. Henderson, REALTOR®, CRS
Fathom Realty Washington LLC - Tacoma, WA
South Puget Sound Washington Agent/Broker!

 Irefrain from giving legal or financial advice and leave it to attorneys and accountants ....

Aug 27, 2016 12:06 PM
Rainmaker
2,224,473
Debbie Laity
Cedaredge Land Company - Cedaredge, CO
Your Real Estate Resource for Delta County, CO

I've just started working on my first one. 

Aug 27, 2016 12:04 PM
Ambassador
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Kathleen Daniels, Probate & Trust Specialist
KD Realty - 408.972.1822 - San Jose, CA
Probate Real Estate Services

I will tell you that I recommend an intermediary ... 

Aug 27, 2016 11:35 AM
Rainmaker
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Michael Setunsky
Woodbridge, VA
Your Commercial Real Estate Link to Northern VA

John DL Arendsen Talk to an Intermediary who knows what they are doing.

Aug 27, 2016 10:42 AM
Rainmaker
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Debbie Reynolds, C21 Platinum Properties
Platinum Properties- (931)771-9070 - Clarksville, TN
The Dedicated Clarksville TN Realtor-(931)320-6730

I can tell you that you need to make sure your client clearly understands how they work and is ready to identify a property within the allotted time ot they are out of luck. This is just a deferment of tax not tax forgiveness or credit.

Aug 27, 2016 10:25 AM
Rainmaker
3,986,258
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

I personally use Starker services and they handle everything.  they are out of Califonia.

Aug 27, 2016 07:52 AM
Rainmaker
1,725,996
Sandy Padula & Norm Padula, JD, GRI
HomeSmart Realty West & Florida Realty Investments - , CA
Presence, Persistence & Perseverance

Select carefully your facilitator. There have been cases when facilitators absond with the funds being held. Make sure he is bonded.

Aug 27, 2016 07:50 AM
Rainmaker
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Joe Pryor
The Virtual Real Estate Team - Oklahoma City, OK
REALTOR® - Oklahoma Investment Properties

Reverse exchanges should be primarily used in larger commerical transactions.

Aug 27, 2016 07:23 AM
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Bob Crane
Woodland Management Service / Woodland Real Estate, KW Diversified - Stevens Point, WI
Forestland Experts! 715-204-9671

Good question John, how much does your Atny and Acct know?

Aug 27, 2016 06:22 AM
Rainmaker
940,545
David Alan Baker | Laveen & South Phoenix Realtor
Keller Williams Realty Phoenix - Laveen, AZ
Your local Expert

I agree with Carol Williams , so many people wait till last minute and end up doing whatever to just avoid it.

Aug 27, 2016 05:20 AM
Rainer
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Jody Wall
BANCROFT REALTY LLC - Grand Prairie, TX
jodywallrealtor.com

I did an exchange last month on one of my investment properies.  You cannot exchange into tax sale properties in Texas because you do not have time to do the 1031 paperwork ahead of time.  You have to pay at the couthouse an hour after the auction.  You cannot buy the property and get reimbursed.

 

1031 exchanges apply to more than just real estate.  If you take a Section 179 deduction on your vehicle, one strategy on the exit is a 1031 exchange.  It also applies to any other capital equipment where the depreciation is faster than the IRS defined usefull life.

It is best to know the basics of the regulations.  Not all accountants are created equally.  How will you know you have the right one if you do not know what to ask?  NO ONE will ever care more about your business than you do.

Aug 27, 2016 04:34 AM
Rainmaker
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Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • GRI • HAFA • PSC Calabasas CA

I provide my clients with basic knowledge ( since I know RE side of it) what 1031 exchange is, if they are interested in tax  benefits, they should talk to their CPA. 

Aug 27, 2016 04:12 AM
Rainmaker
989,652
Jennifer Mackay
Counts Real Estate Group, Inc. - Panama City, FL
Your Bay County Florida Realtor 850.774.6582

I've done quite a few, including several for my own properties.

a 1031 exchange company has all the information required, the only thing I can say differently or in addition is to make sure you stay within the guidelines and make sure your agent is aware of those guidelines so you don't waste time on items that are not of "like kind"

Aug 27, 2016 04:00 AM
Rainer
465,298
David M. Dwares
Title Professionals Corp. - Fort Lauderdale, FL
Title guy with a broker license

They can be simple as long as the 1031 exchange company is competent.  Make sure everyone knows about the exchange as soon as possible, especially the closing agent.  That way there are no last minute surprises.  I have been involved with several as closing agent and attorney for the exchanger.  They are not to be feared, it is a great way to defer taxes.

Aug 27, 2016 03:02 AM
Rainmaker
1,617,916
Harry F. D'Elia III
WEDO Real Estate and Beyond, LLC - Phoenix, AZ
Investor , Mentor, GRI, Radio, CIPS, REOs, ABR

What else is there? Pretty simple rules to follow

Aug 27, 2016 02:45 AM
Ambassador
3,727,873
Patricia Kennedy
RLAH@Properties - Washington, DC
Home in the Capital

I can't tell you more than my attorney and accountant can't!  I've done a couple and always let the attorneys handle the details.

Aug 27, 2016 12:15 AM
Rainmaker
4,571,917
Michael Jacobs
Pasadena, CA
Pasadena And Southern California 818.516.4393

I haven't personally been involved with a 1031 exchange.  The AR membership should be a great source of information for "lessons learned". Good luck.

Aug 27, 2016 12:14 AM
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Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

Sorry but I don't have any personal experience. But from working with some buyers of 1031 exchange properties I would echo what Carol Williams said, and to also keep the central goal in mind. This is not your personal home you are living in fulltime!

Aug 27, 2016 12:04 AM
Rainmaker
5,104,931
Nina Hollander, Broker
Coldwell Banker Realty - Charlotte, NC
Your Greater Charlotte Realtor

Nothing... no personal or professional experience. But I do know one shouldn't do these without allowing for plenty of time to shop for a home.

Aug 26, 2016 11:55 PM
Rainmaker
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Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy

John,

Follow what Carol Williams  said.  A

Aug 26, 2016 11:55 PM
Rainmaker
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Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

I always look for attorney's and accountant's advice.

Aug 28, 2016 06:04 AM
Rainmaker
3,071,489
Tony and Suzanne Marriott, Associate Brokers
Serving the Greater Phoenix and Scottsdale Metropolitan Area - Scottsdale, AZ
Haven Express @ Keller Williams Arizona Realty

Absolutely nothing!

Aug 27, 2016 09:19 PM
Rainmaker
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Roy Kelley
Retired - Gaithersburg, MD

You CPA and attorney should provide all of the advice you need.

Aug 27, 2016 07:25 PM
Rainmaker
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FN LN
Toronto, ON

We do not have such exchanges in our great land.

Aug 27, 2016 03:07 PM
Rainmaker
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Barbara Todaro
RE/MAX Executive Realty - Happily Retired - Franklin, MA
Previously Affiliated with The Todaro Team

the real estate agents don't do anything differently.... I did one many years ago...the attorney handled everything...and I'm sure there was an accountant in the background, but I never had any contact with him/her....the buyer was an attorney, too...

Aug 27, 2016 12:06 AM
Rainmaker
1,525,616
Sybil Campbell
Fernandina Beach, FL
Referral Agent Amelia Island Florida

I know about them but have not personally done one.

Aug 27, 2016 12:03 AM