There are plenty of ways to create additional revenue streams. One option you might want to consider is to buy and sell investment properties. However, some owners opt for a Starker Loophole or 1031 exchange in Minneapolis, Minnesota instead for a higher profit.
In the real estate industry, a 1031 exchange in Minneapolis, Minnesota involves swapping properties help reduce one’s tax obligations. While this presents a good deal, it’s important to understand the intricacies it entails. If you’re looking into pursuing a 1031 exchange in Minneapolis, Minnesota, here are some salient information you need to know:
Origin of 1031 Exchange in Minneapolis, Minnesota
The 1031 exchange in Minneapolis, Minnesota is based on a provision under the Internal Revenue Code (IRC). While they’re taxable as sales, your duties can be reduced or deferred. This means you can grow an investment in a 1031 exchange in Minneapolis, Minnesota without worrying about inflated capital gains taxes.
Assets That Can Be Swapped in a 1031 Exchange in Minneapolis, Minnesota
Prior to the revision of IRC’s provision, a 1031 exchange in Minneapolis, Minnesota is only for swapping like-kind properties. You may trade buildings, lands, equipment, franchises, stocks, and other assets held for business or investment purposes.
However, these conditions changed after December 31, 2017. Any 1031 exchange in Minneapolis, Minnesota made following the said date may only involve investment real estate. As long as your trade is of the same or of greater value, a 1031 exchange in Minneapolis, Minnesota will likely push through.
Rules in a 1031 Exchange in Minneapolis, Minnesota
There are three rules you have to remember when identifying properties for a 1031 exchange in Minneapolis, Minnesota. You need to meet at least one of these requirements to qualify for a 1031 exchange in Minneapolis, Minnesota:
You must identify three assets that you’re willing to swap in a 1031 exchange in Minneapolis, Minnesota, regardless of their market value.
This allows you to pick as many properties as you like for a 1031 exchange in Minneapolis, Minnesota. You only need to acquire them for 95% of their original value or more.
This allows you to put an unlimited number of properties as replacements. However, the cumulative value for these estates shouldn’t exceed 200% of the value that they were sold.
If you’re unsure how valuation works, it’s best to seek the help of professionals. They can help you make more informed decisions when you decide to pursue a 1031 exchange in Minneapolis, Minnesota.
Timing Rules in A 1031 Exchange in Minneapolis, Minnesota
Swapping assets doesn’t happen overnight. Each type of 1031 exchange in Minneapolis, Minnesota follows certain timelines and procedures. Some of them include:
Delayed 1031 Exchange in Minneapolis, Minnesota
These are transactions that take up to 180 days to conclude. During the course of this 1031 exchange in Minneapolis, Minnesota, swaps can be performed simultaneously.
Built-to-Suit 1031 Exchange in Minneapolis, Minnesota
This means a building can be renovated to prepare it for the trade. However, the project should still follow the 180-day timeline of a 1031 exchange in Minneapolis, Minnesota. Otherwise, it will be considered as a personal property and won’t qualify for the transaction anymore.
Reverse 1031 Exchange in Minneapolis, Minnesota
In this type of transaction, one acquires the replacement property before a 1031 exchange in Minneapolis, Minnesota takes place. The estates will be transferred to a mediator and an agreement must be signed.
Note that a swap must take place 45 days upon the replacement property’s transfer, and a transaction must be completed within the normal 180-day timeline. Otherwise, taxpayers who are found to own both assets may be punished by law.
Let Us Help You With A 1031 Exchange in Minneapolis, Minnesota
If you need help with a 1031 exchange in Minneapolis, Minnesota, our team at Christianson and Company is here for you. Contact us today. We offer a unique and informed perspective to help achieve your desired results.
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Your commercial property plays a huge role in your business’s success. If you are struggling with finding or selling an office space that is conducive to profit, turn to us. At Christianson & Company, we offer our clients real estate services in the United States. Tenants, owners, and investors seek our help in finding the best solution for their concerns.
Our professionals have experience in leasing and investment so you can be assured that we will be providing you with exceptional service. We offer a unique perspective that can be beneficial to our clients’ businesses. Our partners in different fields, such as accounting, architecture, and financing, help us guide our clients through the real estate process with their expertise. A strategic solution awaits you when you work with us.
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In searching for the best space for your business, it’s important to find a solution that offers continuous revenue growth for your company while ensuring your staff’s comfort and convenience.
- Tenant Representation – Our connections in the industry allow us to have listings access and contacts that can help you with your search for commercial space. We will take care of your real estate needs so you can use your time to focus on your tasks in your company. With our experience, we have a business mindset that considers how office space will impact your organization.
- Lease and Buy Analysis – If you’re still unsure on whether to buy a space or just lease commercial real estate, our brokers can help you. An analysis of the pros and cons of both options can be done by our team to help you with your decision.
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Services for Building Owners
Commercial real estate is an investment for some. Let our team of knowledgeable brokers help you meet your goals.
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- Acquisition – Our market knowledge will be extremely helpful in looking for the best commercial properties that you can acquire. We can also negotiate to provide you with the best price.
- Asset Disposition – Knowing who your buyers are is the first step into marketing your real estate. We are here to give your property the exposure it deserves in order to reach your potential buyers.
Our team will provide you with the personal attention you deserve when it comes to commercial real estate. We are 100% woman-owned and are celebrating our 20 years in business. Contact Christianson & Company at 952-921-5844 for more details on our services.