Advantages Of 1031 Exchanges In Maine

A 1031 exchange is a way to defer taxes when selling one property and buying another. Properties used for business or investment can qualify. When used properly, it may lead to significant savings. This article provides the advantages of 1031 exchanges in Maine.

Types of Real Estate that Qualify

You must own qualified real estate in order to consider a tax deferred 1031 exchange. Qualified properties are ones used in a business or for investment. They can be land, residential, rental, industrial, and commercial properties. You must also purchase similar real estate that also meets the qualification standards.

Advantages Of 1031 Exchanges In Maine

Usually, when you sell investment real estate, capital gains taxes are due on profits from the sale. This applies regardless of what you plan to do with that funds. Taxes can be levied by the federal and state government. Based on how many years you kept a piece of real estate and how much equity you have in it, the taxes levied may add up to a large sum of money. A 1031 exchange enables you to divert the equity from a real estate sale directly into purchasing another like-kind property and postpone capital gains taxes until you sell that additional real estate. Another 1031 exchange could be possible on that future property to defer taxes even further.

Thinking About a 1031 Exchange

There are different components to a 1031 exchange that you must understand prior to starting to sell aproperty. 1031 Exchanges are not something that you may start after a sale is complete. You must intend to execute an exchange when selling. Certain guidelines must be observed to conform to the exchange. This includes deadlines for identifying and purchasing a replacement. A qualified intermediary must also be used to administer the exchange and funds. If a deadline is skipped, all applicable tax savings will be lost. Consult with an experienced 1031 exchange consultant for more on 1031 exchanges and to enjoy the advantages of 1031 exchanges in Maine.

About Mini Major

Mini views the purchase or sale of a home as a major life transition that usually evokes a wide array of challenges and emotions She brings her strong analytical, communication, and mediation skills to that process. For buyers, she helps to assess realistic goals and maps out a facilitation strategy that is uniquely designed to meet their individual styles with limited stress. For sellers, she provides honest, factual information necessary to set the right price and, together with the extraordinary resources of the Bean Group, provides state-of-the art marketing materials to present that property with appeal to the most appropriate potential buyers.

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