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Eric & Stacy Stauffer - Sotheby's International Realty - Pacific Grove

Eric & Stacy Stauffer - Sotheby's International Realty - Pacific Grove

Selling real estate in: Pacific Grove, Pebble Beach, Monterey, Carmel. Real estate appraisal, inspection, disclosure, marketing plans.

Monterey County Tax Deferred 1031 Exchange

1031 Tax Deferred Exchange Information

What is a 1031 Exchange?

For the purposes of this website a 1031 tax deferred exchange is the selling of an existing rental or investment property and “exchanging” it for another qualifying rental or investment property.

Realtors are qualified to handle certain aspects of the 1031 exchange process. What is really needed is a team: Realtor, accountant or CPA and an “accomodator” or “facilitator”. The Realtor can help you establish the value of the property to be sold or exchanged, market the property to find a qualified buyer and assist in structuring the exchange with the buyer. Qualified Realtors will also help “identify” the “replacement property” and structure the “replacement property” transaction to satisfy the 1031 exchange requirements. The CPA will assit with establishing the profit, or capital gains or “boot” as it is known in the exchange process. If there is no profit or gain there is little reason to do a 1031 exchange. The accomodator or facilitator acts as the neutral party to hold the “boot” or profit until the exchange into the “replacement property” is ready to complete. A somewhat complicated process, but worth it if capitol gains can be deferred and in some cases eliminated.

Why Exchange?

Capital gains tax is significant:

Reinvestment into replacement property allows taxpayer to leverage dollars that would otherwise be spent on taxes:

Allows for non-income producing property to be replaced with income producing property; and

Allows taxpayer to diversify portfolio and minimize risk 

What Does a “Qualified Intermediary” do?

Act as “Qualified Intermediary” as required by the Treasury Regulations:

Prepare all documents required for the exchange:

Consult with your tax advisor

Execute closing documents

Hold the exchange proceeds to avoid constructive receipt of funds; and

Coordinate with the closing agents, real estate professionals, and tax and legal advisors.
IRS Guidelines For 1031 Exchange
Link To: Orexco 1031 Exchange Facilitator
Link To: XChange Solutions Inc.
Eric & Stacy Stauffer are 30 year Realtor - residents of the Monterey peninsula and can assist with your tax – deferred real estate exchange in Pacific Grove, Pebble Beach, Monterey, Carmel or anywhere on the Monterey peninsula. We can help you to establish the current value of property you would like to sell or exchange, professionaly market the property and assist with all aspects of the exchange. We can help you correctly, “identify” quality investment, “replacement” properties. We can then structure an exchange agreement (with the help of your facilitator – exchange company) for the property and orchestrate the closing for an effective tax-deferred exchange.
Call Us At: 831-915-4092