No matter what industry you are in, starting a successful business is rarely easy. The world is becoming increasingly digital every day. With that, many businesses still require physical office space. It is used to host staff, meetings, and daily business administration. On top of a lease or purchase, successful office space also requires a significant amount of capital. It is usually sunk into furniture, equipment, and other small assets.

Is your business has to liquidate? If yes, then selling office furniture and equipment is a great way to earn cash outside of ordinary company operations. The capital is useable to keep your business afloat or simply to recoup losses. Moreover, the bulk sale of office furniture and equipment is likely to come with a large cash inflow.

For large businesses with a significant amount of office space, pricey equipment sales are likely to warrant capital gains taxes, even through bankruptcy. In order to defer capital gains taxes, businesses and individuals can utilize a 1031 exchange with the purchase of a new property. In this article, we will break down the 1031 exchange process when selling your office’s assets.

How to Sell Office Furniture and Equipment

First, let’s look at the office furniture sales process. If you only have a handful of desks, some old computers, and a copier, then it will be very easy to find a buyer through traditional peer-to-peer marketing channels. Both physical and digital, this includes:

• Word of mouth/networking in the building and nearby
• Or local listing sites like Craigslist, Facebook Marketplace, etc.

For small sales, a few hundred dollars will not warrant any capital gains taxes to be applied. In large office downsizes, moves, and liquidations, however, a large sum of assets can quickly reach price tags of tens of thousands of dollars. Today, many large companies utilize consulting agencies and assert intermediaries to facilitate an easy and quickly profitable sales process.

Determining the Value of Office Furniture and Equipment

To keep it simple, the total value of an office overhaul sale is just the sum of all of its parts. Although many things cannot be sold (like the coffee machine that should have been replaced years ago), a lot of furniture and equipment within an office retains its value quite well. While the true value of your furniture and equipment is simply what the buyer is willing to pay, you can get a baseline valuation by totaling your sellable assets. This includes:

• Desks, chairs, and tables
• Computers, phones, and other electronic devices
• Cabinets, bookshelves, and misc hardware
• Copiers, printers, shredders, and other appliances
• Any diminishing assets on hand (printer ink, paper, stationery, etc.)

As ordinary wear and tear are minimal, office administrators with assets less than 10 years old can typically earn back over 50% of their initial investment. If you are working with an agency, they may ask for your proof of purchase receipts as well as any maintenance history for large appliances.

Taxes Paid on Selling Office Furniture and Equipment

If you are selling your office furniture and equipment as part of a large corporate takeover, then all of its value will be bundled with the overall deal. However, if you are selling the office assets to a private party (business or individual) as a one-time deal, then federal and local taxes will be applied. This includes sales tax and capital gains taxes.

Selling Office Furniture and Equipment with a 1031 Exchange

Thankfully, every penny of capital gains taxes applied to the sale of office furniture and equipment can be deferred by purchasing an equal or greater valued asset through a 1031 exchange. For many businesses strapped for cash, 1031 exchanges are extremely valuable for both maximizing the sale and investing in new business assets for future growth. It is also possible to invest in assets that have a lower value than your sold equipment, however only partial capital gains taxes would be deferred in these instances.

Office Furniture and Equipment Like-Kind Properties

The key element of a 1031 exchange is the investment in a new “like-kind” property. The IRS views most property assets (both physical and non-tangible) as like-kind properties for office furniture and equipment. For example, a large liquidation of office assets can be sold in a 1031 exchange if a company were to subsequently purchase:

• Other kinds of equipment
• Cars, trucks, vehicles, etc.
• A new office building or manufacturing facility
• Private property investments (apartments, new construction, etc.)
• Mineral rights and royalties

Office Furniture and Equipment 1031 Exchange Timeline

Selling your furniture and equipment to the new buyer? Then an entity’s eligibility for a 1031 exchange begins. It has to be always valid. How? The taxpayer must submit at least one of three plausible new assets within 45 days of the sale. Ultimately, the company must purchase a new asset (or multiple bundled assets). This is within 180 days of the sale of office equipment in a 1031 exchange.

1031 Exchange Intermediaries for Selling Office Furniture and Equipment

There are many consultants and intermediaries that specialize in the liquidation and sale of office equipment and furniture. In order to meet deadlines and maximize the value of your transition, it is strongly recommendable to sell office furniture with the help of a third party.

Why Purchase Mineral Rights and Royalties?

It might be a bit of a left turn for most individuals and companies. Mineral rights and royalties is actually one of the best ways to maximize the value of a 1031 exchange. A reinvestment in mineral rights is a quick way to liquidize while setting up a new potential value stream.
The purchase of mineral rights can be leasable to oil and gas companies in exchange for ongoing mineral royalties.

Oil and gas leases are will compensate mineral rights owners over time. It is because successful operations are able to find, extract, and sell natural resources. This will help fuel  of today’s world.

if you have further questions about 1031 Exchange Office Furniture and Equipment, feel free to reach out to us here. 

Living out in the country is a breath of fresh air for most people. For others, hanging up the cowboy hat and heading to the city is a tough choice. The coast may be the ultimate choice in order to enjoy life to the fullest. For farmers and ranchers alike, selling the property is a big step. Well, no matter what the next step might be. This is where 1031 Exchange Ranches comes in.

Are you planning to sell your ranch? Then, you may be eligible for a 1031 exchange. This is so long as the sale does not include your primary residence. Are you a rancher with multiple properties? If yes, then 1031 exchanges help taxpayers retain as much of their capital. This is possible when it comes time to sell, by “trading up” for a new personal property.

In this article, we will outline the entire 1031 exchange process, beginning with the sale of a ranch. With this, we will present mineral rights as one of the most important things to consider when identifying new properties to purchase within the exchange.

How to Sell A Ranch

First things first, let’s sell your ranch. For those that are not aware, ranches are large plots of land for raising cattle and other livestock. It is typically in western North America. A farm is useable to grow agricultural crops. On the other hand, ranches are primarily useable for producing meat, dairy, and other animal products. In some cases, ranches and farms are simultaneous if the property is for multiple disciplines. Today, ranches also offer many services beyond their exports including horseback riding, accommodation, event hosting, and more.

Ranches can be sold on the open market, just like any other personal property. Many ranchers start with a simple sign in their front yard. Moreover, there are also a number of different marketing methods that are useable o locate a buyer. Today, ranches are typically sold in online auctions with the help of a broker or industry-specific real estate agent.

Determining the Value of Ranches

Even if you are planning to use an agent in the sale of your property, it is generally a good idea to have an approximate estimate of your ranch’s value. A ranch is essentially just a sum of its parts, which add up together to make the property’s total value. In order to begin to get an idea of your ranch’s value, it’s good to make a list of its features including:

• Acreage
• Land condition
• Number of existing structures and condition
• Whether or not livestock is part of the package
• Included water or mineral rights
• Zoning elements
• And more

In truth, the actual value of a ranch is only going to be as much as a buyer is willing to pay. In booming areas of the United States, land for continued ranching or otherwise repurposing can be extremely valuable when considering the potential development onsite.

Ranches can be sold with or without present livestock, which can add a significant amount of value to the sale in question. Before putting a price on your ranch, it is always a good idea to check local listings of similar properties in order to gather information on current market conditions.

Taxes Paid on Selling Ranches

In most parts of the United States, ranches of all shapes and sizes sell for hundreds of thousands of dollars, and often even more. Not only are ranches used as homes, second homes, and country getaways, but they can also be used to start a business and begin earning revenue. If your ranch is not your primary home, the sale of it generally warrants:

• Federal Income Taxes
• Capital Gains Taxes
• Sales Taxes
• Local Taxes
• And More

Unfortunately, ranch sales are subject to considerable taxation, at rates up to over 40% of the sale price. While most of this is unavoidable, capital gains taxes are deferrable by taxpayers who choose to purchase a new property in a 1031 exchange.

Selling Ranches with a 1031 Exchange

Under the IRS code for a 1031 exchange, the rules are laid out simply so that investors can avoid capital gains taxes otherwise associated with the liquidation of their assets. When purchasing a new property of equivalent or greater value, investors can “trade” their ranch for a new asset, and avoid paying capital gains taxes entirely. In a similar vein, new assets of a lesser total value can be purchased to avoid a partial amount of the capital gains tax.

Ranches Like-Kind Properties

In order for a 1031 exchange to truly be complete, taxpayers must acquire a like-kind asset after the sale of a ranch. Ranches are one of the highest valued kinds of personal property on the market today, so exchanging for a new, more expensive asset may actually be a bit difficult. However, if you don’t need the cash immediately, the following properties can be considered as “like-kind” for ranches:

• Farms and farmland
• Apartment buildings
• Condos
• Vacation rentals
• Shops and malls
• Mineral rights and royalties
• And more

Ranches 1031 Exchange Timeline

1031 exchanges have a purchasing period of 180 days. This mean upon the sale of your ranch, you have approximately 6 months to replace it with a new asset and follow the proper paperwork with the IRS. This may seem like a long period of time. Still, it is important to note that taxpayers need to identify at least one new, potential property within 45 days of the sale.

Why Purchase Mineral Rights and Royalties?

In the United States, investors can buy and sell mineral rights, regardless of the surface rights of a property. In this split estate model, mineral rights owners are able to enter into oil and gas lease agreements with companies interested in extracting and selling any natural resources found on the property. With this, monthly oil and gas royalty checks are payable to mineral rights owners if the operation goes as planned.

Conclusion on 1031 Exchange Ranches

In conclusion, ranches are sellable for a large amount of money. More of which are retainable with a 1031 exchange. When considering a 1031 exchange, many busy investors find that working with a specialized 1031 exchange intermediary can save time and maximize the potential of a further investment of the capital.

If you have further questions about 1031 Exchange Ranches, feel free to reach out to us here.

What’s in a name? Sometimes everything. Are you or your company have a valuable trademark? Then it can likely be sold for a tremendous amount of capital. Trademarks and intellectual property sales are generally a smaller part of a larger merger. Sales with large bottom lines are often an attractive choice after building a successful brand.
What about if the time comes to sell your trademark or intellectual property (IP)?

With that, hefty transactions are often lessened by local and federal taxes. How about in the United States? Capital gains taxes are deferrable on the sale of trademarks or IP with the use of a 1031 exchange.

In this article, we will detail the steps required for selling trademarks and intellectual property. It is when utilizing a 1031 exchange. What’s next with the acquirement of a new asset is necessary? We will also demonstrate how mineral rights can be an attractive option for new capital investment.

How to Sell Trademarks and Intellectual Property

Do you remember the process of creating your trademark? The eventual sale of intellectual property will actually resemble it in a lot of different ways. Once you’ve found a buyer, trademark, and intellectual property sellers are required to notify the U.S. Patent and Trademark Office (USPTO) and file the necessary paperwork to transfer ownership.

More often than not, the sale of a trademark or IP is the result of a buyer finding a seller. This is rather than the other way around. With that said what if you are interested in selling your trademark? Well, there are a few designated online listing sites available that act as a virtual IP marketplace. Beyond this, word of mouth and industry outreach are other popular ways to sell potentially valuable trademarks to relevant buyers.

Determining the Value of Trademarks and Intellectual Property

Although they are intangible, trademarks and intellectual property can be extremely valuable to their owners. Prices are completely up to the discretion of the seller, and IP sales generally come after several negotiations.

The actual value of any kind of intellectual property is truly only determined by a price that a buyer is willing to pay. Trademarks and IP are usually purchased with future cash flows in mind as a result of the acquisition of the property.

Taxes Paid on Selling Trademarks and Intellectual Property

High ticket trademarks and intellectual property can be taxed at rates up to 40% in some areas of the United States. This sizable chunk of the sale price can be accounted for through the following taxations:

• Federal Income Taxes
• Capital Gains Taxes
• Sales Taxes
• Local Taxes
• And More

While most of these payments cannot be avoided, investors in the United States have the unique opportunity to defer all or some of the capital gains taxes paid on the sale of trademarks and intellectual property. To do so, taxpayers must purchase a new property to “replace” the trademarks or IP through a 1031 exchange.

Selling Trademarks and Intellectual Property with a 1031 Exchange

In a 1031 exchange, trademarks, copyrights, and IP can be sold free of capital gains taxes with the purchase of an asset of equal or greater value. If taxpayers choose to purchase a new asset of lesser value than their sold IP, then it is possible to defer only some of the capital gains taxes that would otherwise be paid in the year of the sale. With rates up to 20% for some individuals, 1031 exchanges are one of the most popular tax-saving strategies in the US.

Trademarks and Intellectual Property Like-Kind Properties

At the heart of a 1031 exchange, it is essentially a legal way to “trade” your IP for another asset to maximize your wealth. In the United States, the IRS will typically allow most reasonable personal property acquisitions to qualify for a 1031 exchange with the sale of trademarks, copyrights, patents, and IP. Most commonly, taxpayers can purchase:

• Land
• Businesses
• Farms
• Art Work
• Apartment Buildings
• Mineral Rights and Royalties
• And more

Trademarks and Intellectual Property 1031 Exchange Timeline

By law, taxpayers using a 1031 exchange have 180 days to purchase a new asset after an intellectual property sale. This equates to roughly 6 months. From the date of the sale, it is required that sellers identify at least one reasonable property that can be considered for purchase. This does not need to be the actual asset required, as sellers can identify up to three potential assets for consideration, regardless of their value.

1031 Exchange Intermediaries for Selling Trademarks and Intellectual Property

With paperwork, deadlines, and new properties to consider, most busy investors choose to utilize a 1031 exchange intermediary when selling trademarks, copyrights, and IP. Specialized 1031 exchange intermediaries are very valuable resources for ensuring the successful completion of the transaction with maximum return on investment potential.

Why Purchase Mineral Rights and Royalties?

When considering new assets after the sale of trademarks and IP, it may be difficult to know where to start. In the United States, investors have the unique opportunity to purchase mineral rights, which can be leased to oil and gas companies for the exploration and sale of natural resources.

As a mineral rights owner, successful energy operations entitle you to monthly mineral royalty payments. Royalty payments, also known simply as royalties, typically come in the form of a fixed percentage of operational profits, as defined in an oil and gas lease agreement.

Conclusion

In conclusion, mineral rights and royalties should strongly be considered when selling trademarks, intellectual property, or copyrights in a 1031 exchange. By avoiding capital gains taxes and earning future mineral royalties, taxpayers can maximize their IP sales with a smart reinvestment of capital. For this reason, we strongly recommend working with 1031 exchange intermediaries with exceptional knowledge in the mineral rights industry.

If you have further questions about the 1031 Exchange Trademarks, feel free to reach out to us here.