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However, a real property within the United States and a real property outside the United States would not be like-kind properties. Generally, "like kind" in terms of real estate, means any property that is classified real estate in any of the 50 U.S. states or Washington, D.C., and in some cases, the U.S. Virgin Islands.
Property transferred in a like-kind exchange is often encumbered by liabilities and debt, especially where the asset is real estate. In this regard, the tax code treats relief from indebtedness as additional cash boot in a like-kind exchange. In other words, the assumption of a taxpayer's debt is treated like the receipt of cash by the taxpayer.
It is a hybrid of the common installment sale and a structured annuity, and it enables the seller to collect a stream of payments, leverage equity, earn a pre-tax return, and other benefits. This method is a tool for those who want to do a 1031 exchange but cannot find a property within the time frame, and it allows the seller to have a backup ...
A tax expert breaking down the tax benefits of buying home. In the U.S., owning a home can lead to significant tax benefits, which might include deductions for mortgage interest, property taxes ...
Here are 15 real estate terms you need to know. Real Estate Agent Professional who represents the seller (listing agent) or buyer (buyer’s agent) in a real estate transaction.
Some states could make up the difference by implementing higher state sales taxes on everyday items, often referred to as a “consumption tax.” According to data from the Tax Foundation , 45 ...
This amount would likely be higher. When used in the gain formula, the higher basis would result in lower gain and, therefore, a lower tax liability. The three most significant nonrecognition provisions are: • Like-kind exchange [4] • Involuntary conversions [5] • Transfers between spouses and certain former spouses [6]
In the United States, real estate investments yield considerable tax advantages. [1] One benefit is the ability to regain the cost of income producing (for example, commercial real estate) properties through depreciation. When a property is bought in the United States, the cost of the building and land are capitalized.