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Author Topic: IRS income tax on sale of REI property  (Read 4936 times)

Offline irish30

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IRS income tax on sale of REI property
« on: August 25, 2014, 03:31:35 pm »
Is there a time factor between selling a REI property and buying another with out  the IRS tax coming due.
In other words, after a property closes escrow, how much time do I have to purchase another REI property to postpone payment of the tax .

Offline Bill H

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Re: IRS income tax on sale of REI property
« Reply #1 on: August 29, 2014, 11:36:19 pm »
Are you referring to a 1031 Tax Deferred exchange?

Are you referring to the fact that you just sold a property and want to delay the payment of the taxes due?


Offline mcwagner

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Re: IRS income tax on sale of REI property
« Reply #2 on: August 30, 2014, 02:01:34 pm »
To defer taxes, you must do a 1031 exchange.  And you must start the exchange before the property is sold.

If you have already sold the property, it is too late to defer taxes.  Purchasing another property does nothing with regard to the taxes due on the sale of the first property.

How the taxes are calculated depends on if this was a rental, or a rehab/flip.  How much basis you had  on the original purchase, how much depreciation was taken, rehab costs, improvements, etc.
Mark Wagner, CPA, LLC
Certified Public Accountant
http://www.facebook.com/MarkCWagnerCPA

 




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