Question

Report

After buying an investment real estate with a loan on another investment property, what is the time frame for selling that property so it could be used for the exchange?

Asked by
Donald Deacon l 1 year ago l In: Finance
Tags:
investment real estate, investment property, time frame
Answer it!

Answers (4)

Sort By: Dates l Votes
Turk89
0

Votes

Report

A: Commercial property investment is a decision always interesting. It is no good buying a commercial property, if there is a recession in progress and is not a good time to buy when the economy is booming and the costs of commercial properties go through the roof. Buying a commercial property in "just in time to" maximize profitability and capital gains, and seems to rise to a threshold. The question is: how do you knowwhere this hump? - Investment property loans How do you know if that threshold is really happening, often from experience, discernment and good business information. To experience these costs in one way or another, but if you learn that your right to not break the bank, and you will gradually win enough to invest and purchase experience, how to increase the commercial investment portfolio. Read more: http://www.articlesbase.com/investing-articles/investment-property-loans-and-to-a-good-time-commercial-real-estate-investment-loan-3312618.html#ixzz12vMxmyhB Under Creative Commons License: Attribution

Answered 1 year ago by: Turk89
Scott Saunders
0

Votes

Report

A: There is no holding period specified in the tax law after which property will qualify as “held for investment.” To qualify, an exchanger must have the intent to hold for investment. Intent is a subjective thing, so the IRS will look to objective factors that evidence the purpose for which property is held. Time is only one factor that may be considered in assessing the exchanger’s intent. Many other factors (in fact, “all facts and circumstances”) surrounding the taxpayer’s ownership and transfer of property may be considered in determining the taxpayer’s intent.

In one private letter ruling (PLR 8429039), the IRS stated that a minimum holding period of two years would be sufficient. Revenue Procedure 2008-16, which created a safe harbor for an exchange involving certain kinds of personal use or vacation property, specifies a “qualifying use period” or holding period of two years if the exchanger desires comfort that the IRS will not challenge the exchanger’s intent to hold for investment. Other tax and legal advisors recommend that exchangers hold property for a minimum of at least twelve months.

Every exchanger should also be aware that they will have to disclose to the IRS the amount of time they held the relinquished property when they file Form 8824 (Like-Kind Exchanges) along with their tax return. Each exchanger and their advisors should be able to substantiate that both the property relinquished and acquired in a §1031 tax deferred exchange were held for investment.

Answered 1 year ago by: Scott Saunders
Jacqueline Cliff
0

Votes

Report

A: This is truly a question for your tax attorney or CPA. There are several things to remember here and that is short/long term capital gains and the conditions of your loan.

Now if I am reading it right, you have mortgaged one property to buy another, which will avoid the issue of the loan, but will still leave you with dealing with the short term capital gain issue. Call your pros, they need to answer this one for you!

Answered 1 year ago by: Jacqueline Cliff

I am your professional real estate broker for the Seattle, WA area! Have questions about buying or selling a home or investment property in the greater Seattle area, I am the one real estate broker to call.  I specialize in working with first time buyers and with people that have had bad experiences with real estate agents in the past. Call me today at 425-773-3... show bio

William Nottoli
0

Votes

Report

A: When the "investor", I am referring to the person who actually lent the money for this purchase, usually has a 12 month prepayment penalty. Some will have only 6 months. The reason is the "Investor" is looking for a certain amount of return on their investment and if the loan is not seasoned for 12 months and their return is not what he expected. Then this money will be directed in other investment areas instead of loans.

Answered 11 months ago by: William Nottoli

Retired from the Air Force in 1989,  Realtor and Loan Officer in Utah from 1998 - 2007, Affiliate Marketer http://www.wrnottoli.com show bio

Answer this question

Ask a question

200 Characters left
Ask

Ask a question

Ask
200 Characters left

Related Videos

Quantcast