Scenario
I bought condo A and have a mortgage of $60K. My wife is selling a condo B for $60K and doing a 1031. A friend is willing to buy my condo A for $60K and simultaneously sell it to my wife for $60K plus $1.00. I will pay all closing cost on my sale of condo A to the friend and my wife will pay all closing cost on buying condo A from the friend. Is this a legal transaction?
You also state "it is the most costly property". Is it the most desireable? If not, pass on it. It is always best to buy low in a neighborhood than the best house on the block.
Thanks for the response. The leasback is 8%. With 10% down and covering all other costs I will receive $500 per month positive. The prop is the most favored but my question is the regarding the tax advantage. Depreciation? I will be able to sell for the purchase price at a minimum. May be a slight loss?
I use a CPA here in California that I highly recommend. He knows RE like the back of his hand -- he owns 200+ homes in TX. I know he does taxes for other REI out of state. Let me know if you want his info.
But he will only solve some of your issues. I recommend you get organized and keep great records in a s/w program. When Tax season hits, it should be fairly painless.
Yes, please send me his info! thanks!!
I use MS Money, by the way, to track my RE biz transactions. I was just hoping there was something better out there.
I actually do my own after being screwed by a Tax Attorney.
You may want to try INTUIT products (makers ofTurboTax, Quicken etc) They also have Rental Property Manager, as well as Real Estate Solutions software including Commercial.