1031 Real Estate Exchanges May Fuel The Economic .eback For Some But Not Many-freelander2

Real-Estate-FSBO 1031 Real Estate Exchanges May Fuel the Economic .eback For Some But Not Many When the economy crashed, the real estate bubble burst led the way for most of us. The headlines were all about auto and bank bailouts, passing Obama care and trillion dollars scares… I and millions of property owners watched our real estate portfolios plummet. While some were lamenting their 401 k"s, I was looking at a house listed for sale at $175,000 below tax assessed value. Now over 24 months later, I still have not sold the property and no one is even looking at it. I guess I"m really lucky; I still have some equity and the house rents for about what it costs. I consider myself self employed as a landlord. Rental in.e is my only in.e. When I sell a property I reinvest taking advantage of tax laws if I can. My business is just as viable and important to the country as any other small business. My business created steady jobs, bought materials, and paid taxes. I have done a number of 1031 exchanges over 25 years of real estate investing. The government has effectively killed landlord rental investment type business. The sad part is that with some minor legislation tweaks our lawmakers could effectively bring back small and large investment landlord business. This is what they need to do. #1, pass legislation requiring banks considering loans to credit 100% of rental in.e reported on form 1040, not the 75% they currently credit. Not counting our reported in.e is unfair and just plain stupid, our employee"s in.e is counted when they apply for a loan and we could fire them tomorrow, but our in.e is not considered dependable, even though we as landlord property owners hold all the cards. #2, do not require exchangers to replace mortgages, simply pay capital gain tax on profit and allow exchangers to pay all cash for replacement property. The reason being, WE CAN"T GET LOANS YOU MORONS. #3, allow tax deferred proceeds from property sales to be used to pay down mortgages on other investment properties. Here"s what is happening right now in the rental property market NOTHING and it will continue to be nothing because we are boxed into a corner. A typical scenario goes like this. I want to sell a property I have owned for many years. When I purchased this property many years ago I did a 1031 exchange, consequentially I have a large deferred tax bill. Upon selling this property I will have to pay about 1/3rd of the proceeds in taxes, about 1/3rd will go to pay off the mortgage and 1/3rd will .e to me. I can"t do another 1031 exchange because I no longer qualify for a loan. I can"t use the 1/3rd cash portion to buy a replacement property because it is not enough money to buy something even remotely adequate. So in this scenario I do nothing, which means zero business activity, zero tax payments, zero, zero, Or alternately I sell my property, pay the tax, pocket the cash and I"m out of business, zero landlord, zero business. After 25 years my business will no longer benefit the economy and my real estate buying and selling days are over. Now I know that real estate investor landlords aren"t the only fuel the economy uses but the government needs all the help it can get right now. John 2010 About the Author: 相关的主题文章: