If you had the choice of taking $1,600 a month taxable for 8 months or recieving nothing during that time, but get $1,600 x 8= $12,800 TAX FREE at the end of 8 months… which one would you take and why?
need more info…
specifically, are the risk the same? if both are truly guarenteed money then tax-free is always best; even if you have to wait a few months to get it.
also depends on your tax bracket (fed) (which you may not want to disclose) and your state of residence.
For example, my incremental tax rate for ordinary income is about 40% (resident of Calif.); that a huge barrier to overcome and I am always looking for tax-deferred type deals ( have done a few 1031 exchanges)
Thats an arbitrary situation. Each ones own situation & circumstance would dictate a different answer.
If you have immediate debts to pay or have a good deal buyt need cash, then obviously you would take the cash now.
I would take the second one, it just sounds a bit better.
If looking for ways to defer tax, consider using your IRA to purcahse properties. Check out the portability laws passed recently that outline this…