Why consider 1031 exchanges in Orlando?
1031 exchanges are acknowledged as being an excellent method to build long term wealth by deferring taxes.
We can meet the rules and regulations set forth in the 1031 exchange programs for purchasing a property in Orlando. We have a growing demand for 1031 exchanges in Orlando as the short term rental market continues to expand.
Traditionally, investors invest in properties for long term rental, commercial strip malls with long term tenants. What a growing number of 1031 investors are realizing is that the short term rental market in Orlando can offer excellent returns on investment.
One of the largest benefits of purchasing a vacation home in Orlando as part of a 1031 exchange, is that you will be investing into one of the strongest rental markets in the world.
Based on the last 5 years, our vacation home owners are achieving 40+ weeks rental per year. You will also be allowed to use the property for a maximum of 14 days per year according to 1031 rules.
What is a 1031 exchange?
1031 exchanges are deferred tax investments – often used for real estate investments which offer some form of rental income.
When you sell your property in order to make a 1031 exchange you have 45 days to identify a new property to purchase. You should also have 2 secondary options as fall backs.
Once the initial property is sold you have 180 days to close on the new property. You must invest (including closing costs and transaction duties) the same amount as you have received for the sale of your property plus $1 or more.
If you have a little extra cash you can also purchase a property at a higher price. You can do this by taking out a mortgage loan on top of the cash from the 1031 funds.
Many 1031 exchange investors are unaware that you can roll monies from their IRA into the 1031 exchange. You can do this through the application of the 1035 exchange module.
Tax Benefits of 1031 exchanges in Orlando
We advise you speak to an experienced CPA as you may be able to reduce your income taxes by formalizing these transactions correctly.
Successful 1031 investments
Well-furnished vacation homes in good communities can achieve over 40 weeks of paid occupancy each year. Even after the cost of management, booking fees, licenses and HOA, this type of investment property offers excellent returns. Especially, when compared to more traditional investment properties.
When you are ready to take the next step get in contact with us. We will assist you in identifying suitable properties within the 45 period.
Disclaimer: You should always speak to a licensed professional when dealing with 1031 exchanges and 1035 exchanges.