Posted by dealmaker on March 14, 2005 at 13:10:56:
AFAIK there’s been no change that I haven’t heard of the REPLACEMENT property must be title EXACTLY as the other one was. Ran into this myself, I owned a place as seperate PPTY, now married, had to buy the new place in MY NAME ONLY, or risk causing a taxable event. Anyway, another 18 months and I can add the wife.
BTW, I’d NEVER buy property with anyone else and their spouse, but that’s just my opinion.
dealmaker
1031 Exchange - Buying with a partner - Posted by Pradeep
Posted by Pradeep on March 14, 2005 at 10:30:45:
My wife and I own a condo that we have rented out for two years. We would like to sell it and buy a 4 unit rental property with our friend and his wife.
I have been told we might run into some problems. The title for the new property needs to in the same name as the one we are selling.
Any help with info regarding this issue would be appreciated. I know I need to check with a CPA/Attorney before I make a final decision.
Re: 1031 Exchange - Buying with a partner - Posted by William L Exeter
Posted by William L Exeter on March 16, 2005 at 11:50:39:
Yes, you can do this. You and you wife would acquire an undivided XX% interest in the property and your friend and spouse would acquire the remaining undivided XX% interest in the property as tenants-in-common. The percentage that you acquire is the portion that would apply toward your 1031 exchange, so you need to make sure that the percentage that you acquire is sufficient to satisfy your 1031 exchange values. For example, if the duplex that you are selling is worth $500K, then the percentage of the property that you are acquiring must be worth at least $500K or more. You must also reinvest all of your net cash from the sale of your property and you typically must replace the same amount of debt.
Always review the transaction with your tax advisor BEFORE you close on the transaction.