1031 Exchange Software

1031 Exchange Software [Ultimate Guide]

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For the past 20 years, the software has slowly risen. It becomes one of the highest valued industries in the world. There is a global potential and minimal starting costs. That’s why tech entrepreneurs everywhere have made millions of dollars with the development and deployment of software. Have you heard of 1031 Exchange Software?

Many choose to sell software as a service (SaaS). There is other free software like apps and online marketplaces that can sell advertisements for ongoing revenue streams. As a successful product on the market, software owners have the choice of maintaining their service. They can also sell the company that the software supports.

When choosing to sell, the software can yield enormous cash flows for the purchase of cutting-edge or popular technologies. With this, considerable taxation is usually applicable, some of which are avoidable with a 1031 exchange.

In this article, we will explain how to 1031 exchange software. With this, we will explore like-kind properties such as mineral rights and royalties for maximum returns on the software sale.

How to Sell Software

Before you can 1031 exchange software, you will first need to sell it. There are hundreds of thousands of jobs for software sales in the United States. Most of these are based around user acquisition. Are you the owner of a piece of software or a builder of it? Then you have every right to sell your intellectual property, hardware, userbase, and more in a full transfer of ownership.

Depending on the quality of your product, it is generally not difficult to find buyers. In fact, many software developers in the startup universe simply built products just to sell them for enormous profits at later dates. If your “company” is nothing more than some of the best code ever written, then you will likely be selling simply the software’s “IP” in the event that there are no employees or pieces of hardware necessary to maintain the program.

Determining the Value of Software

Software and software companies are constantly being sold on the open market at an immense range of valuations. National and local headlines in tech industry blogs often cover software sales, so it is relatively easy to estimate the approximate worth of your software ware. Of course, the value of software is largely intangible, with an enormous focus being put on the software’s potential, rather than its current condition.

The following attributes should be considered when determining the value of software:

  • Current availability (on-market or off-market)
  • Number of users (if applicable)
  • Software cash flow (current and future projects)
  • Potential revenue streams
  • Integration with purchasing entities systems and IP
  • And more

Taxes Paid on Selling Software

Although many will tell you that they’ve been burst by the dot com bubble one too many times, software sales continue to earn developers large amounts of money every year in the United States. If done legally, software sales are subject to significant taxation from the local and national governments. For big sales, capital gains taxes are applicable at rates as high as 20% of the transaction value.

How to 1031 Exchange Software

A 1031 exchange of software is an IRS-designated transaction. It allows taxpayers to defer up to 100% of the capital gains taxes applied to the sale. In order to eliminate every dollar of the capital gains tax, sellers must acquire a new asset of equivalent or greater value in order to 1031 exchange software. Here, the 1031 exchange essentially allows individuals to “trade up” their software for a new property.

Of course, if you sold your software at such a high price that you never have to work another day in your life, it is possible to acquire an asset at a lower valuation. With this, partial capital gains taxes can be deferred.

Software Like-Kind Properties

Software and software companies are largely intangible. The IRS views its IP as simple personal property. Just like most of the things that they can buy and sell on the open market. Under the 1031 exchange code, software sales must be followed by purchases of “like-kind” property for a valid transaction and tax deferment. Like-kind properties for software or software companies may include:

  • Collectibles (cars, toys, etc.)
  • Boats
  • Vacation Rentals
  • Convenience Stores
  • Trailer Parks
  • Water and Ditch Rights
  • Mineral Rights and Royalties
  • And more

Timeline For a 1031 Software Exchange

From the exact day of the sale, sellers have 45 days to identify at least one reasonable property to purchase in a 1031 software exchange to remain eligible for the transaction. Up to two more properties are considerable regardless of their value, and purchase must be within 180 days of the sale.

For additional requirements, please see our 1031 Exchange Rules and Requirements Page.

Using an Intermediary to 1031 Exchange Software

It has become increasingly common for investors to utilize specialized 1031 exchange intermediaries when selling high-value software. With an intermediary, it can be much easier to handle all negotiations, paperwork, and exploration for new properties in a 1031 exchange.

What’s the Best 1031 Exchange For a Software?

If you are about to 1031 exchange software, you’ll find a wide variety of new assets to choose from. Although options are limitless for personal assets in the United States, mineral rights are one of the best properties to acquire in a 1031 exchange. As a largely hands-off asset, mineral rights entitle you to the ownership of the natural resources found below the surface of the earth in a designated area.

As a mineral rights owner, oil and gas companies can lease your land to extract and sell valuable resources on the open market. In exchange, you will receive mineral royalty checks as outlined in your mineral rights lease agreement.

Conclusion

When it comes time to sell your software, you can be in for a large influx of cash if your product is worth it. Although it is tempting to go overboard with celebrations, a reinvestment of your capital with a 1031 exchange can not only save you money on the sale of software but also generate a future stream of income.

Foreign-Property

1031 Exchange Foreign Property [Ultimate Guide]

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Foreign property is exciting to purchase, but can often be excruciating to sell. Depending on the country in which you’ve invested, you may be seeing a huge developmental gain. You may also see a staggering financial loss if the time has come to sell your foreign property. That’s why knowing all about the right process on 1031 exchange properties for sale, specially for foreign properties, is important

Land and buildings in areas outside of the United States are subject to the laws of their native country. Are you a taxpayer in the US? If yes then the sale of your foreign property will also accumulate hefty regulation. It also includes taxation on your income.

With this in mind, what will happen? Double taxation will quickly eat away at your chances of turning a profit on your international investment. To mitigate this, capital gains taxes are often deferral by way of a 1031 exchange. This requires former property owners to “trade” their sold property for new, similar investments.

In this article, we will outline the steps necessary to 1031 exchange foreign property. Moreover, we will eliminate capital gains taxes. With this, we will also showcase the strength of mineral rights and other profitable investments. These are the new properties under a selection of a 1031 exchange of foreign property.

How to Sell Your Foreign Property

Before you can 1031 exchange a foreign property, you will first need to sell it. Selling is typically through an intermediary unless the property is the seller’s personal residence. In this case, it is sellable directly from the owner. Real estate practices, systems, and laws are different in every country around the world. Basically, sellers must be aware of all of the regulations pertaining to the sale of their property.

Determining the Value of Your Foreign Property

Somewhat obviously, the value of your foreign property is going to be under approval by a myriad of factors. This will usually differ in location. Are there no improvements in your property? If none, then it will likely be sellable at a similar value as to when it was purchased. Are choosing to sell your foreign property by yourself? Then it is important to check the current market conditions in your area and adjust the price accordingly.

With the sale of foreign property, sellers must also consider the current exchange rate for local currencies back to USD. Everything on US taxes must be in US currency. With that, any gains on foreign property sales must be as so. Large differences in exchange rates may be responsible for net loss or gain on a property.

Taxes Paid on the Selling Foreign Property

Whenever a foreign property is sold by a US taxpayer, they will pay the IRS an amount of money. The common term is as an “ex-pat tax,”. This is the sum of a few different plausible taxations. In the event of a foreign property sale, the net loss or gain of the sale must be reported. This is within Section D on that year’s income tax return. From there, losses cannot be written off, whereas gains are subject to taxation from federal, state, and capital gains taxes.

Gains up to $250,000 can actually be under exclusion from domestic taxation from the sale of foreign property abroad. Here, foreign properties that served as a taxpayer’s primary residence for at least 2 of the last 5 years. These are eligible for gains exclusions on property tax.

How to 1031 Exchange Foreign Property

If the net gain on your foreign property sale is large enough, then it will likely be subject to capital gains taxes in the sale’s calendar year. In the United States, the IRS has granted the unique opportunity to “trade” foreign properties in a 1031 exchange in order to defer capital gains taxes. Even if the taxation isn’t significant, utilizing a 1031 foreign property exchange in order to maximize property sales with new, cash-positive assets, will be well worth it.

Foreign Property Like-Kind Properties

Whenever a foreign property is 1031 exchanged, it must be “replaced” with a new, similar, or “like-kind” property. While you may be selling land, buildings, or other high-ticket items overseas, personal property sales can be exchanged for many different kinds of assets in the United States. So long as you are selling a home, a building, or your foreign property, 1031 exchange can mitigate capital gains taxes if you purchase:

  • Another physical property (in the US or abroad)
  • Collectibles and artwork
  • Conservation easements
  • Mineral rights and royalties
  • And more

Timeline For a 1031 Foreign Property Exchange

Once the property is sold, taxpayers then have to identify one new property within 45 days if they would like to remain eligible for the 1031 foreign property exchange. This does not necessarily need to be the purchased property, and two other potential assets can be properly identified, regardless of their value. If no new properties are purchased within 180 days of the sale, then the foreign property seller is no longer eligible for a 1031 exchange.

For additional requirements, please see our 1031 Exchange Rules and Requirements Page.

Using an Intermediary to 1031 Exchange Foreign Property

Due to the complexities of undergoing a 1031 foreign property exchange, most investors typically choose to use a specialty 1031 intermediary for the sale of property in relation to domestic taxation. In some cases, intermediaries are also able to help identify new properties that are best suited for the investor’s budget and goals.

What’s the Best 1031 Exchange For a Foreign Property?

Taxpayers are free to choose from a wide variety of new assets after the sale of a foreign property. But unlike in most countries around the world, United States property owners have the unique opportunity to 1031 exchange foreign property into mineral rights. With mineral rights, the subsurface of a property is lapsable or sellable to oil and gas companies hoping to explore and extract minerals from the land. When these natural resources are under sale, mineral rights owners have the entitlement to mineral royalties, which come in the form of a monthly payment from the operation’s profits.

If your foreign property is not your primary residence then it will likely be necessary that capital gains taxes are payable. So long as you are not in the need of house hunting, mineral rights, and royalties service as the perfect reinvestment of wealth for the 1031 exchange of a foreign property. They are often hands-off investments with the potential for large streams of future royalty payments.

Do you have 1031 Exchange Properties for sale? Feel free to reach out to us here and we will assist you further.

1031 Exchange Second Home

1031 Exchange Second Home & Other Vacation Property [Ultimate Guide]

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Owning your own vacation home can be a paradise. This is true for those fortunate enough to invest in a second home or apartment. A second home provides a great source of income. Moreover, you can enjoy any time of the year when guests are not around.

Of course, if the right opportunity comes, selling a vacation property can be an attractive idea. This is true especially for a quick lump sum of cash. A large sale is a great way to diversify your wealth once the allure of frequent getaways has worn off. This is when weighed against the ongoing maintenance, marketing, and upkeep of a leased second home.

Unfortunately, with a large sum of cash transferable to personal income, vacation home sales often lead to excessive taxation from the IRS. High-value vacation rentals are subject to capital gains taxes, which are deferrable in a simple 1031 exchange.

Vacation homes are one of the most common and useable assets in 1031 exchanges. Many wealthy investors use the opportunity to “trade up” for new property tax-free. In this article, we will outline the steps necessary to 1031 exchange second home or other vacation property and avoid capital gains tax and maximize profit.

How to Sell A Second Home

Before you can 1031 exchange vacation home, you will first need to sell it. Do you own your second home for a while? Chances are that you’ve had your fair share of offers from guests after their week in paradise. Whether or not you should take these handshake deals, is all up to you. Know that the 1031 exchange is a much better way of selling your vacation property in the 21st century.

Determining the Value of A Vacation Home

With rapid acceleration in condensed areas, a second home can bring a tremendous gain in the right areas of the country. Conversely, natural disasters, poor upkeep, or depleting local economies unfortunately often land vacation property sellers with less than what they paid for originally.

If you plan to list your vacation home yourself or would like to get a ballpark idea of its value before speaking with a broker, one must consider the following factors to determine the value of a vacation home:

  • Size of home
  • Condition and upkeep
  • Current leasing price and rental history
  • Community amenities
  • Staffed or contracted services onsite

In popular vacation destinations, there are many similar vacation rentals within close proximity to one another. If you are selling in a dense area, the easiest way to get an idea of your second home’s value is to look at local listings for buildings and land that share similar characteristics with your vacation home.

Taxes Paid on the Selling Second Home

Unlike in the sale of a personal residence, vacation homes that are considerable as a business or second home are subject to capital gains taxes in the event of a sale. Capital gains taxes can be as high as 20% on expense vacation homes, in addition to the federal, local, and sales taxes that are also applicable to the bill of sale. With every dollar adding up, many investors choose to defer capital gains taxes on sales through a 1031 second home exchange.

How to 1031 Exchange Vacation Home

In a 1031 exchange, vacation home sellers must purchase a new asset “in exchange” for their old property. If the new property is of equal or greater value, then taxpayers through the 1031 exchange have the opportunity to defer every dollar of capital gains taxes. In the same vein, lower-value assets are purchasable for a partial omittance of capital gains taxes.

Vacation Home Like-Kind Properties

Vacation homes are some of the most common assets in 1031 exchanges. Sales of second homes are subject to taxation, but capital gains taxes are completely avoidable with the proper paperwork and the purchase of a new “like-kind” asset. In a 1031 exchange vacation home can be exchanged for many like-kind assets, including:

  • Apartment Buildings
  • Trailer Parks
  • Convenience Stores
  • Golf Courses
  • Farms
  • Water and Ditch Rights
  • Mineral Rights and Royalties
  • And more

Timeline For a 1031 Second Home Exchange

Once you sell your second home, you have exactly 180 days (or about six months) to purchase a new property for a valid 1031 exchange of the second home. If filed correctly, taxpayers will completely defer capital gains taxes in the year of which the exchange was completed. Additionally, it is important to note that one “reasonable” property must be identified within 45 days of a vacation home sale for the taxpayer to remain eligible for the 1031 exchange.

For additional requirements, please see our 1031 Exchange Rules and Requirements Page.

Using an Intermediary to 1031 Exchange Second Home

For most, the process of filing governmental paperwork and meeting strict deadlines can be daunting in an already busy life. Because of this, many sellers will choose to work with an intermediary in order to 1031 exchange vacation homes smoothly and make sure the reinvestment is maximized when identifying the new asset for the 1031 exchange.

What’s the Best 1031 Exchange For a Vacation Home?

Although taxpayers are free to 1031 exchange second homes for a wide variety of new properties, mineral rights offer a unique opportunity for investors looking to maximize their wealth. In the United States, mineral rights can be leased to oil and gas companies to explore, extract, and sell natural resources from the subsurface of a property. In doing so, mineral rights owners earn oil and gas royalties as a fixed percentage from the monthly operations.

Conclusion

Had years and years of vacations? Do you feel it’s time to sell your vacation home? 1031 exchange is one of the best decisions that can be made. Are you seeking an income stream that is a bit more passive than maintaining a second home? Mineral rights are one of the best new properties that can be purchased income tax-free in a 1031 exchange. Reach out to us here.

1031 exchange gold

1031 Exchange Gold, Silver & Numismatic Coins [Ultimate Guide]

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Precious metals are, well, precious. Gold, silver, and even historic coins are some of the oldest representations of wealth. They currently hold value in the world today. Gold, silver, and coins come in all shapes and sizes. Extensive collections or large individual pieces can warrant huge cash sales to the right buyer.

Knowing this, investors with large reserves of precious metals will likely encounter a huge capital gain. This is once you are able to sell the collection. Although this is certainly exciting, it often becomes a little less. This is when capital gains taxes are payable on the sale of gold, silver, or numismatic coins.

Thankfully, modern IRS codes allow for large private property sales to defer capital gains tax with a 1031 exchange. In a 1031 exchange, a new property is purchasable with the proceeds of the sale. This is so that investors essentially “trade” their assets, rather than pay capital gains taxes.

In this quick guide, we will outline the steps to 1031 exchange gold, silver, or numismatic coins. With this, the reinvent potential is limitless. We will showcase mineral rights and royalties as one of the best possible private property purchases.

How to Sell Your Gold, Silver, or Numismatic Coins

Thanks to its value and history! There is essentially an unlimited number of ways to sell precious metals in today’s open market. From online sales to the pawnshop down the street, nearly everyone knows that gold, silver, and coins can be a strong investment that will hold its value for potential resellers.

With this, legitimate you must complete the sale with proper paperwork if you are hoping to utilize a 1031 exchange. While this is somewhat obvious, it is important to remember that legal sales to legitimate sellers are going to be the best way to maximize the sale of gold, silver, or numismatic coins.

Determining the Value of Your Gold, Silver, or Numismatic Coins

Everyone knows gold, silver, and coins are valuable, but how valuable? Numismatic values of coins are generally far and beyond their original face value. That’s why first-time sellers may have a difficult time determining the approximate value of new metal products.

Gold, silver, and numismatic coins are generally valued by the following considerations:

  • Type of metal and its current market value
  • Percentage of precious metal within assets
  • Size, quantity, and weight of the collection
  • Current asset conditions
  • Number of previous owners
  • And more

While most gold, silver, and numismatic coin sales are to private investors and entities, precious metal sales also have the opportunity for a few unique market positions. Beyond individuals, companies, governments, and even museums may be interested in acquiring gold, silver, or numismatic coins.

Taxes Paid on the Selling Gold, Silver, and Numismatic Coins

In legitimate sales, the IRS classifies gold, silver, or numismatic coins to be “collectibles.” With this in mind, considerable taxes are paid whenever precious metals are sold. Although the rates are variable depending on your location, the following may be paid on the sale of gold, silver, or numismatic coins:

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

When considering a collectible, taxpayers do not get the benefit of long-term capital gains tax rates. Instead, the sale of gold, silver, or numismatic coins is likely to coincide with a capital gains tax rate of up to 28% of the total bill of sale. Knowing this, the difference of capital gains taxes with a 1031 exchange is becoming increasingly common among both new and experienced investors.

1031 Exchange Gold, Silver & Numismatic Coins

1031 exchange gold, silver, or numismatic coins can be used to avoid every penny of capital gains tax if taxpayers choose to invest the sale into a new asset of equal or greater value. While partial fees can be deferred with a property of lesser value, this is less common than investments that allow taxpayers to stretch their capital as much as possible.

Gold, Silver & Numismatic Coins Like-Kind Properties

The sale of gold, silver, or numismatic coins presents the opportunity to reinvest in a large number of different personal properties with a 1031 exchange. While the true definition of “like-kind” properties is quite loose, the IRS allows the following to be exchanged for gold, silver, and numismatic coins:

  • Mineral rights and royalties
  • Cars and other collectibles
  • Homes and apartments
  • Office buildings
  • Convenience stores
  • Trailer parks
  • And more

Timeline to 1031 Exchange Gold, Silver & Numismatic Coins

After the asset is sold, taxpayers have exactly 180 days to replace gold, silver, or numismatic coins in a legal 1031 exchange. While this offers a grace period of essentially six months, at least one new property must be identified within 45 days of the sale.

Here, deadlines must be met alongside the necessary paperwork to legitimize a 1031 exchange. With this, many investors choose to work with a 1031 exchange intermediary to ensure the entire process is as smooth as possible. Beyond this, industry-specific experts are also available to assist in property identification to maximize your investment.

For additional requirements, please see our 1031 Exchange Rules and Requirements Page.

What to 1031 Exchange Gold, Silver & Numismatic Coins For

While private property owners can choose to invest in virtually anything with a 1031 exchange, mineral rights present a unique opportunity for taxpayers within the United States. With mineral rights, also known as subsurface rights, the property is leasable to oil and gas companies to explore, extract, and sell natural resources such as oil, gas, coal, or more. In doing so, mineral rights owners can receive monthly mineral royalty payments in compensation for their participation.

Conclusion

In conclusion, 1031 exchanges are one of the best ways to maximize the sale of gold, silver, or numismatic coins. With each dollar of capital gains taxes saved, reinvestment can go further into a new private property. Today, few investments are available that are quite like mineral rights, which can serve to become a profitable income stream or high-value resell in a world of growing energy demand.

1031 exchange aircraft

1031 Exchange Aircraft [Ultimate Guide]

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Not everyone has the privilege of their own private aircraft so for sure 1031 exchange aircraft is not on everyone’s knowledge. Whether it be a propeller plane, private jet, or fleet of helicopters, aircraft possession is usually only under reservation. Usually for the immensely wealthy or a handful of diehard aviation enthusiasts.

With that in mind, when it comes time to sell an aircraft, a lot of capital is going to be around. No matter the age or operating function, planes and helicopters are generally at high ticket selling prices to wealthy bidders.

Here, experienced investors know of a little trick called a 1031 exchange. In this IRS-designated procedure, a taxpayer can evade capital gains taxes on the sale of a large asset by reinvesting the capital in another purchase. In doing so, 1031 exchanges can be useable to “trade” aircraft for other private properties.

Moreover, in this article, we will outline the steps it takes to 1031 exchange aircraft. In doing so, we will illustrate mineral rights and royalties as a great property option for investors looking to maximize the sale of an aircraft.

How to Sell an Aircraft

Even in the third decade of the 21st century, we still seem far away from the cartoon future of flying cars everywhere, owned by everyone, like in The Jetsons. With a limited market, this proves to make private aircrafts somewhat difficult to sell. Here, we recommend working with a broker to help facilitate the sale. Once the deed is complete, any registration or FCC licenses in the previous owner’s name must be removed.

Determining the Value of Your Aircraft

Most private aircraft actually retain their value quite well. So long as it was always in good operating condition and was purchased from a reputable seller, the price you paid for your aircraft may actually be quite similar to the price that you sell your aircraft years later. FOr this reason, jets, planes, and helicopters are popular business assets for reserving large amounts of money within the organization’s portfolio.

The value of an aircraft is determined by the following attributes:

  • Type of aircraft
  • Make and Model
  • Size
  • Age
  • Condition
  • Fuel efficiency
  • Added or removed features
  • Branded or not branded exterior
  • Navigation features
  • And more

Of course, the true value of any aircraft is only the amount that someone is willing to pay for it. While you may own your aircraft privately or as a part of a company’s asset portfolio, an aircraft can then be sold to individuals or businesses large and small. With that said, planes and helicopters with significant mileage are usually deemed unfit for commercial use by many private businesses and government regulations.

Taxes Paid on the Selling Aircraft

As we mentioned earlier, planes, helicopters, and jets sell for an awful lot of money. Whether it be a one or two comma deal, former aircraft owners can expect a bulge influx in cash if the time comes when they decide to sell. Unfortunately, with every dollar earned, another portion of that dollar may be taxed by local, state, and federal governments.

When selling an aircraft, you can expect to pay:

  • Personal Property Tax and Registration Fees
  • Depreciation
  • Passive Activity Losses
  • Federal Income Taxes
  • Capital Gains Taxes
  • Sales Taxes
  • Local Taxes
  • And More

When all is said and done, aircraft sales can come with nearly 40% of the capital going to taxes. Naturally, one of the best and most common ways to reduce this amount from totaling beyond its worth is to 1031 exchange aircraft.

1031 Exchange Aircrafts

In a 1031 exchange, aircrafts sold and replaced with an asset of equal or greater value will result in the complete deterrence of capital gains taxes that would have been otherwise paid. Whereas it is possible to only partially eliminate some of the capital gains taxes paid on the sale of an aircraft, most investors choose to “trade up” for another aspect that is either functional or financially favorable.

Aircraft Like-Kind Properties

In order for a 1031 aircraft exchange to be valid, an aircraft must be replaced with a “like-kind” property. The IRS is pretty open to what can be considered similar, largely viewing most property assets as in the same vein. With that being said, helicopters, planes, and jets can be used in a 1031 exchange to purchase:

  • Homes
  • Apartments
  • Convenience Stores
  • Farms
  • Water and Ditch RIghts
  • Mineral Rights and Royalties
  • And more

1031 Exchange Aircraft – Timeline

Although it may take some time to find the right buyer, as soon as the sale of an aircraft is officially complete, then the taxpayer’s eligibility for a 1031 aircraft exchange begins immediately. From here, at least one potential property must be identified for purchase within 45 days. Following this, a new property must be purchased within 180 days (or roughly half of a year) in order to avoid paying capital gains taxes on the sale of their aircraft.

For additional requirements, please see our 1031 Exchange Rules and Requirements Page.

Using an Intermediary to 1031 Exchange Aircraft

Obviously, deadlines must be met and paperwork must be filed to complete a successful 1031 aircraft exchange. While both time-consuming and laborious with extreme attention to detail required, it is recommended that investors work with a 1031 exchange intermediary to maximize the sale of an aircraft.

What to 1031 Exchange Aircraft For

In the United States of America, private landowners can buy and sell their properties subsurface in the form of mineral rights. With mineral rights, the land can then be under leasing to oil and gas companies. They are companies looking to find, extract, and sell the natural resource found beneath the earth’s surface. Once it’s sold, mineral rights owners will then receive mineral royalty payments as a fixed percentage of the operation’s income.

Conclusion

When it comes time to 1031 exchange aircraft, purchasing mineral rights is one of the best portfolio adjustments. That is exclusive to a few select countries. In doing so, mineral rights can generate highly profitable streams of income. That is through monthly royalty payments or another large lump sum in a future sale.

If you have further inquiries on 1031 exchange aircraft, feel free to reach out to us here.

1031 exchange artwork

1031 Exchange Artwork [Ultimate Guide]

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Have you heard of 1031 Exchange Artwork? Artwork and mineral rights do not have a lot in common. Whereas one hangs on a wall or appears in a gallery. The other is deep below the surface of the earth. Perhaps there is only one thing that artwork and mineral rights have in common. It is that both of these assets could be found in a well-balanced investment portfolio.

As energy becomes more important with each passing day, mineral rights continue to be one of the most valuable assets. Especially for American investors can hold. If the time has come to part ways with a piece of art, large sales can be maximized. This goes with a smart reinvestment.

In this article, we will break down the steps to take to 1031 exchange artwork. In doing so, we will showcase how like-kind properties such as mineral rights are the best way to maximize the sale of artwork.

How to Sell Your Artwork

Artwork has been one of the longest-standing types of assets throughout human history. Today, artists around the globe are selling their work in galleries, both online and in person. While there are a million different ways to network and sell pieces of your own artwork, this guide is intended to help investors who purchase and sell fine art for their homes, office space, and more.

You can 1031 exchange artwork only once the artwork is sold. If you are trying to sell a private collection of fine art, there are a few different methods you can choose from. Most commonly, investors choose to work with an art dealer. With mitigation and connections, a dealer may be able to accelerate the sale of your art at a similar or increased price for what you originally paid for it.

Determining the Value of Artwork

Artwork is tough to put a price on. In fact, it is safe to say that most people in the world have walked through a “fine art” gallery only to be left in shock to learn about the great expense of relatively simple-looking art pieces. With that being said, the fine art market continues to boom throughout the modern age and the price of a piece or portfolio is truly only equal to the price that someone is willing to pay for it.

Depending on the nature of the piece, any artwork is usually priced on:

  • The Size
  • The Materials
  • Framing vs. Unframing
  • Transportation Concerns
  • Artist Reputation
  • Quality
  • And more

Taxes Paid on the Selling Artwork

When selling artwork, the sky’s the limit. While starving artists may never get their reward, there are also many pieces around the world being exchanged for huge sums of money. While cash deals at artist’s markets may never see taxes being applied to the profits, there are considerable taxes paid on the sale of large private pieces and collections of art. Typically this includes:

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

1031 Exchange Artwork

Depending on how long you held your artwork in your private gallery or collection, the sale may have short or long-term capital gains taxes applied. This could be anywhere from 0 to 20% of the piece’s final price, depending on how much the artwork is sold for.

With a 1031 exchange, artwork can be sold without having to pay any capital gains taxes. Here, the artwork must be “exchanged” for another asset within a fixed period of time. In doing so, reinvestments of funds qualify for complete or partial deferral of capital gains taxes.

Artwork Like-Kind Properties

The IRS qualifies pieces of fine art into the private property category. This means that artwork is no different than your house, your clothes, or your car and it can be bought and sold on the open market as a privately owned good.  In a 1031 exchange, artwork can be sold in exchange for:

  • Mineral Rights and Royalties
  • Homes and Apartments
  • Trailer Parks
  • Shopping Malls
  • And so much more.

1031 Artwork Exchange Timeline

With artwork sales, finding the right buyer is everything. Sometimes this is accomplished as soon as the piece premiers, whereas other times fine art can be held in a private gallery for many years before being purchased by an art collector. With this in mind, the clock begins ticking on 1031 artwork exchange eligibility as soon as a piece of artwork is sold.

Within 45 days of the sale of the artwork, one property must be identified for a like-kind 1031 exchange to be valid. Beyond this, taxpayers have exactly 180 days to purchase the new property for the elimination of capital gains taxes.

For additional requirements, please see our 1031 Exchange Rules and Requirements Page.

Using an Intermediary to 1031 Exchange Artwork

With the paperwork to file and deadlines to meet, we highly recommend working with a 1031 exchange intermediary when selling artwork and eliminating capital gains taxes. In doing so, taxpayers can focus more on their time identifying and evaluating potential assets.

What to 1031 Exchange Artwork For

More than anything, we strongly recommend that first-time sellers and experienced investors consider purchasing mineral rights in a 1031 artwork exchange. As the owner of a property’s subsurface, mineral rights holders can enter into mineral rights leases with oil and gas companies.

In doing so, a steady stream of mineral royalty payments can be earned as a fixed percentage on the monthly profits from natural resource sales. Mineral royalties are only available in a few countries throughout the world, with the United States being one of the few nations that allow the private ownership of mineral rights.

Conclusion

In conclusion, we hope that this article was helpful to people selling their artwork. We also how that you will utilize a 1031 exchange. When comparing new, like-kind properties, we strongly suggest considering mineral rights as a great part of any diverse investment portfolio.

If you have further inquiries on 1031 exchange artwork, feel free to reach out to us here.

1031 exchange rental property

1031 Exchange Rental Properties [Ultimate Guide]

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Do you know one of the most common ways to make your money work for you? Here in the United States, it is to invest in a rental property. Homeowners begin to realize fairly quickly this opportunity. They realized that purchasing a property and renting it to another is a great way to earn passive income. This is without having to perform that many day-to-day tasks. We will talk more about 1031 exchange rental properties in this article.

Of course, rental properties do not always pan out the way that some land and building owners had expected. Some properties may have trouble acquiring consistently paying tenants. Other assets may be better off sold for a tremendous amount of money.

With a large sale, comes large taxes. If you plan to sell your rental property, then it is important to be aware of the possibility of a 1031 exchange. This is one of the smart tools that many savvy investors are using. In this article, we will outline the steps necessary to 1031 exchange rental property and maximize the potential for reinvesting your funds.

How to Sell Your Rental Property

Of course, you can 1031 exchange rental property only once the property is sold. Rental properties are not by definition rental properties. Planning to sell your rental property to a new owner? Then they may live in the space part or full time without continuing the legacy of leasing out space.

With this in mind, coastal areas and vacation destinations are full of short-term rental properties. Whereas most American cities have long-term rental properties looking for monthly tenants. This can be in the residential, commercial, and industrial spaces.

With all of this in mind, there are essentially an unlimited amount of ways that you can go about selling your rental property. The secret is to find the right buyer and put the property in front of as many potential investors as possible. Today, this is most commonly useable by taking advantage of online retailers, specialty real estate agents, and property auctions

Determining the Value of a Rental Property

Depending on the type of property, a rental space can have a tremendous range of values. Rental properties are essentially a sum of their parts, but also have a lot of external factors to consider when putting a price tag on a personal asset.

In most instances, the value of a rental property is determinable by:

  • The size of the property
  • Number of buildings and building types
  • Property leasing history (short vs. long term)
  • Current physical condition
  • Market trends
  • And more

Of course, the true value of your rental property is only the amount that someone is willing to pay for it. Smart bargaining and demonstrated income potential will serve as allies when putting your rental property in the eyes of serious buyers.

In some cases, existing tenants may have an interest in purchasing the property that they are currently leasing. While this is saving them a ton of time and cost on moving, selling to existing renters is usually done so at a discountable rate if the relationship is strong thus far.

Taxes Paid on the Selling a Rental Property

Rental property sales are typically for a lot of money. Unfortunately, this means that rental property sales generally come with a large amount of taxes paid on the income generated from the financial exchanges. While landowners are no stranger to paying property taxes, most expenses applied to the sale of a rental property are one-time-only. These include:

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

With governments taking their piece of the pie, it is not uncommon to pay as much as 40% in taxes on the sale of a large rental property. Some of this is avoidable, however, if taxpayers choose to utilize a 1031 rental property exchange.

1031 Exchange Rental Property

Rental properties are sellable using a 1031 exchange. This is an IRS procedure to eliminate the partial or total amount of capital gains taxes on the sale of private property. By trading up for another large investment, taxpayers’ capital gains taxes are deferrable if they are reinvesting the proceeds from a rental property sale into a new kind of asset.

As with most governmental dealings, 1031 rental property exchanges can be painstakingly detail-oriented with paperwork and deadlines to fill out and meet with precise requirements. Because of this, we strongly recommend that both new investors and experienced wealth managers use a 1031 exchange intermediary to make sure that everything is done correctly.

Rental Properties Like-Kind Properties

First, rental properties must go through the exchange for something that is “like-kind” for a valid 1031 exchange. Thankfully, the IRS views rental properties in the same what that they do most other private assets. For this reason, rental properties can be exchanged for

  • Commercial Buildings
  • Gas Stations
  • Shopping Malls
  • Apartments
  • Homes and Condos
  • Water and Ditch Rights
  • Mineral Rights and Royalties
  • And more

1031 Exchange Rental Property – Timeline

Once a rental property is finally sold, then taxpayers have 180 days to purchase a new asset to qualify for a 1031 exchange. Before this, at least one property must be identified (but not necessarily purchased) within 45 days of the sale.

For additional requirements, please see our 1031 Exchange Rules and Requirements Page.

What to 1031 Exchange Rental Properties For

At the end of the day, there are a lot of different ways that you can reinvest the funds from a rental property sale. However, the United States is one of the few countries that permits taxpayers to invest in might rights.

By purchasing mineral rights, you can become the owners of the subsurface of a property. With this, you can enter into an oil and gas lease, which allows energy companies to extract and sell resources from your property. In doing so, mineral rights are useable to establish another great passive income stream, from monthly mineral royalty payments.

1031 exchange hotels

1031 Exchange Hotels and Motels [Ultimate Guide]

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Owning a hotel or a motel is one of the most interesting property types in a portfolio. This is from a business standpoint. A highly profitable daily rate can lead to enormous cash flow. On the other hand, uncontrollable influences may lead to a hotel’s or motel’s ultimate demise.

Have you decided that your hotel has had its last facelift? Do you have an interest in selling your property to invest your money elsewhere? A 1031 exchange can be utilized to eliminate capital gains tax when reinvesting in a new property. This is for both hotel and motel sales.

Mineral rights and royalties rarely have as much upkeep or attention required to benefit from the investment. This is unlike hotels and motels, In this article, we will outline the steps necessary to 1031 exchange hotels and motels into mineral rights and royalties.

How to Sell a Hotel or Motel

Of course, in order to 1031 exchange hotels and motels, you must first obviously sell it. Selling a hotel or motel may actually be considerably harder to sell than you may have anticipated.  Hotels and motels commonly sit on the open market for months and even years on end. This is common in communities with dwindling populations or tourism,

Today, most hotels and motels are sellable with the help of a commercial real estate agent. In some cases, the hotel’s property you can find out for the desirable land it occupies. Whereas the majority of new owners will likely try to operate the businesses or repurpose the structure.

Determining the Value of Your Hotels and Motels

Are you using the help of a professional third party or not? It’s always a good idea to know the approximate value of your hotel. This is when trying to sell it in the open market. As most hotels are sellable as operational entities, there are a considerable amount of factors that go into determining the value of a hotel or motel.

Some of these include:

  • Property Size
  • Building Size and Condition
  • Current Assets (i.e. beds, dressers, TVs, etc.)
  • Staff and Business Conditions
  • Branded chains vs. non-branded
  • Hotel vs. motel
  • Amount of Parking
  • Location
  • And more

It may be challenging to tally all of your assets into one magic number. Hotels and motels are sellable all around the country. With this in mind, it is not difficult to check online marketplaces to see the average hotel and motel prices in current market conditions.

Taxes Paid on the Selling Hotels and Motels

When piecing it all together, both hotels and motels can be sold for enormous amounts of capital. Since the dawn of time civilization, however, taxes have been taken out of large property sales, and hotels and motels are no exception.
In the United States, the following are paid on the sale of a hotel or motel:

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

So clearly, taxes will add up when selling a motel. Of course, capital gains taxes are deferrable if trading a hotel or motel with a 1031 exchange.

1031 Exchange Hotels and Motels

With a 1031 exchange, hotels and motels can be traded for properties of equal or greater value in order to fully avoid any capital gains tax imposed. Properties must be bought and sold by the same taxpayer and deadlines must be met as per IRS regulations.

With this in mind (and the idea of filling out detailed government paperwork), we highly recommend using a 1031 exchange intermediary to handle the tax process and/or assist with the property identification.

Hotels and Motels Like-Kind Properties

According to the IRS tax code, 1031 exchanges are only valid if the properties bought and sold are of “like-kind.” Essentially, what this means is that the assets in question must bear at least some kind of similarities. Thankfully, hotels and motels are considerable as both property and business entities. This allows them to be go through the exchange for a large number of like-kind properties.

This includes:

  • Apartments and apartment buildings
  • Single-family homes and condos
  • Trailer Parks
  • Farms
  • Water and Ditch Rights
  • Mineral Rights and Royalties
  • And much more

Hotels and Motels 1031 Exchange Timeline

Once a hotel or motel is sold, taxpayers have 45 days to identify at least one property that can be considered for the 1031 exchange. This property does not necessarily need to be the one purchased, but an asset must be acquired within 180 days of the sale for a valid 1031 exchange. Up to 3 properties can be identified, regardless of their value.

For additional requirements, please see our 1031 Exchange Rules and Requirements Page.

What to 1031 Exchange Hotels and Motels For

Of all of the property assets that can be bought and sold in the world, mineral rights and royalties are one of the only ones that are unique to a few countries. Here in the United States, the acquisition of mineral rights can lead to extensive mineral royalty payments under the right oil and gas lease.

While a hotel or motel requires frequent decision-making for the continuous operation of the property, active mineral rights are a rarely-seen, yet a highly-desirable piece of many great investment portfolios.

Conclusion

Hotels and motels have been around forever and will likely continue to function as a large chunk of commercial real estate property throughout the world. With this in mind, hotels and motels are bought and sold constantly, sometimes out of desperation and other times out of pure profit.

Either way, when selling a motel or hotel, a 1031 exchange is great for quickly reinvesting your money with the least amount of capital losses in the process. In the United States, mineral rights and royalties should always be considerable as a great opportunity for return on investment.

1031 exchange gas stations

1031 Exchange Gas Stations [Ultimate Guide]

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For first-time sellers and experienced investors, gas stations can be purchased, improved, and sold for tremendous profit margins. There are more and more cars on the road every year. That is the reason why gas stations are a staple of the American road system. It is providing food and fuel to travelers on roads both large and small. Today, the sale of a gas station can be maximized by using a 1031 exchange. In trading for another property, capital gains taxes are deferrable and more of the proceeds from a gas station sale are useable for reinvestment. In this article, we will explain and outline the steps that need to be taken in order to 1031 exchange gas stations. With that, we will also make the case for mineral rights and royalties. They are one of the best possible ways to continue to benefit from the sale.

How to Sell A Gas Station

In order to 1031 exchange gas station, you must first obviously sell it. Selling gas is easy, but selling a gas station isn’t as so. Gas stations are a highly specialized kind of property unlike any other commercial real estate of its kind. Knowing this, the process of selling a gas station may be more laborious than you originally anticipated.

With that, gas stations are located practically everywhere across the country. It is as nearly every town in America is home to one or two. This familiarity makes the sale of a gas station more likely among investors looking to buy a property type that has stood the test of time.

For the most part, gas stations are sold with the help of a specialized, commercial real estate agent. This is most commonly true in big cities and towns. However, in highway communities across the country, a gas station may likely be one of the highest valued properties in the area.

Determining the Value of A Gas Station

Today, gas stations are typically sold in online listings or through word of mouth. Gas stations are sold on the open market and can only truly be valued by the highest purchasing bid. Although some abandoned facilities will go to auction, typically gas stations are sold after negotiations of a predetermined sales price.
As the sum of many different parts, the total value of a gas station can be determined by summing the following considerations:

  • Property size and condition
  • Number of buildings, size, and conditions
  • Number of filling stations
  • Bonus facilities (car wash, air pumps, etc.)
  • Branded affiliations (both for store and gas pumps)
  • Business records, profit and loss statements, etc.
  • Transferable employees
  • Current supply chain relationships
  • And more

So clearly, there are a ton of things to consider before putting a price on your property. If possible, locate the properties appraisal records, as well as the previous listing prices for other gas stations in the local vicinity.

Taxes Paid on the Selling Gas Stations

As both a business and a property, gas stations are often sold for significant amounts of money. Of course, for every dollar that a gas station is sold for, more taxes are applied to the sale by local and federal governments. When selling a gas station, the following are usually applied:

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

1031 Exchange Gas Stations

Of course, savvy investors trying to pinch every penny from their sale are well aware that 1031 exchanging gas stations can partially or completely eliminate capital income taxes paid on the sale of a gas station. By “trading-up,” for a new property, the IRS allows for capital gains taxes to be avoided if the same taxpayer simply reinvests their money elsewhere.

Gas Station Like-Kind Properties

Of course, you can’t use a 1031 exchange to trade just anything for a gas station. Instead, the property must be considered to be “like-kind” in the eyes of the IRS. Thankfully, most physical assets qualify as similar enough to gas stations in order to qualify for a 1031 exchange.

For instance, the following can be considered like-kind properties:

  • Strip malls and shopping centers
  • Trailer parks
  • Hotels
  • Water and ditch rights
  • Mineral rights and royalties
  • Farms
  • Office buildings
  • And more

1031 Exchange Gas Station – Timeline

Gas stations can take a considerable amount of time to sell, so it is a good idea to consider what you might use a 1031 exchange to purchase even before you are headed to a large check. This is especially true because at least one property must be identified in the first 45 days after the sale of a gas station. Beyond that, taxpayers have just 180 days, or roughly 6 months to purchase a new property in a 1031 gas station exchange.

Failure to meet deadlines and file paperwork on time is typically not forgiven by the IRS. With this in mind, it is strongly recommended to work with a 1031 exchange intermediary when maximizing the reinvestment of your funds.

For additional requirements, please see our 1031 Exchange Rules and Requirements Page.

What to 1031 Exchange Gas Stations For

Mineral rights and royalties are highly profitable ventures that many American investors are still unaware of. The truth is, for the past 100 years, mineral rights owners have been leasing their subsurface property to oil and gas companies in exchange for sizable mineral royalty checks.

In a sense, selling a gas station and purchasing mineral rights is kind of like selling your house and buying a quarry that exports building materials. By going “back to the source,” an investment in mineral rights is a largely passive income stream that does not require the maintenance and upkeep as a gas station does.

Conclusion

In conclusion, gas stations are highly valuable, which is why it is important to maximize the proceeds when selling one on the open market. By utilizing a 1031 gas station exchange it is possible to defer tens of thousands of dollars in capital gains taxes that would have been otherwise paid. Although the choice is yours to reinvest in any kind of property, mineral rights and royalties are an easy way to stay profiting in the oil industry with significantly less time and effort.

1031 exchange condominiums

1031 Exchange Condominiums [Ultimate Guide]

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Condominiums, or simply “condos,” are a great way to purchase property to live in, rent out, or resell. Sort of halfway between an apartment and a home, condominiums make for a great living situation for many people.

With that, the sale of a condo is likely to flood former owners with a large sum of cash. For first-time flippers and experienced investors, using a 1031 exchange is a great way to get the most out of your sale with a smart reinvestment.

In this article we will detail everything there is to know about 1031 exchange condominiums, and why mineral rights and royalties are the perfect property upgrade.

How to Sell A Condominium

Do you remember when you bought your condominium? It was pretty easy, right?

Well, good news, selling a condominium is usually just as simple. Although we’ve all heard our fair share of property nightmare stories, condominium real estate exchanges are usually fairly straightforward and easy to navigate.

So long as there is buyers’ interest, condos can be sellable in just about every way imaginable. Most commonly, this includes:

  • Hiring a Realtor to Market the Home
  • Selling By Owner
  • Yard Signs
  • Online Listings
  • Newspaper Ads
  • Word of Mouth, etc.
  • Reselling to the Builder
  • Gifting or Bequeathing to Friends and Family

Determining the Value of Your Condominium

The great thing about condominiums is that there are so many similar properties surrounding each and every one of them. Finding the value of your condominium may be as easy as knocking on your new neighbor’s door and asking how much they paid.

Of course, condominium value is also impacted by many individual variables including:

  • Number of Previous Owners
  • Pet History
  • General Condition
  • Appliance Upgrades
  • Number of Units
  • Community Amenities
  • Market Fluctuation
  • And more

In general, condominiums follow normal real estate market trends. In booming areas, value can fluctuate just as in cities with lowering populations. For long-term owners, a condominium is usually sold at a similar or greater price than it was purchased.

Taxes Paid on the Selling Condominiums

Even if you are selling your condo without the help of a realtor, accountant, or broker, you will still have to pay taxes on the money earned from the sale. Although the percentage of the gross amount varies by region, state, and city, most people pay the following on the sale of a condominium:

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

Although most people say that the only two things that are certain in life are death and takes, it is possible to avoid some taxation with smart money management. You may not be cheating death, but a 1031 exchange can be used to reinvest the money from the sale of a condominium into another profitable property.

In doing so, you can eliminate all of the Capital Gains Taxes that you would have otherwise paid to the IRS that calendar year.

1031 Exchange Condominiums

1031 exchanging condominiums is very easy. However, it does take a considerable amount of effort and careful attention to detail.

If you would rather save time and possibly earn more on a 1031 exchange investment, there are many industry experts available to help identify similar properties, meet deadlines, and process legal documents.

Condominium Like-Kind Properties

First and foremost, a 1031 exchange gets its name from the requirement to “trade” a condominium sale for another property. The IRS permits most other land-based properties as “like-kind,” including:

  • Mineral Rights and Royalties
  • Parking Lots
  • Shopping Centers
  • Trailer Parks
  • Water and Ditch Rights
  • Apartments
  • Homes
  • Farmland
  • And More

1031 Condominium Exchange – Timeline

To start, you have 45 days to identify at least one reasonable like-kind property from the sale of your condo. By reasonable, the law dictates that it should be not only like kind, but also of similar or greater value.
1031 exchange qualification expires after 180 days if a new property is not purchased. After 180 days, capital gains taxes are no longer withheld from the sale of the condominium. A maximum of 3 like-kind properties can be identified without having to factor in their value.

For additional requirements, please see our 1031 Exchange Rules and Requirements Page.

What to 1031 Exchange Condominiums For

Mineral rights are the total or partial ownership of the subsurface of a plot of land. In the United States, they are available to purchase just as any other property like condos, farms, and homes.

If your dreams of renting the condo out to paying tenants have not matched your expectations, mineral rights are another great way to earn monthly income from owning property.

Each month, leased oil and gas companies are able to extract, process, and sell oil and gas from the mineral rights property that you own. In most cases, you may never even see the operation, however, a monthly oil and gas royalty check will be paid to your name as a fixed percentage of the resource sales.

How to Maximize Your 1031 Condominium Exchange

If you’ve spent too much time in your condo in the city, mineral rights may be a new concept for your investment portfolio. However, states like Texas, Colorado, Pennsylvania, and more contain highly valued mineral rights properties that are both active and waiting for resource extraction.

Mineral rights are valued on their estimated remaining reserve capacity as well as the percentage ownership as granted by the contract.

Conclusion

If you’re selling your condo, consider using a 1031 condominium exchange to purchase mineral rights and oil and gas royalties. In doing so, your reinvestment will not only eliminate capital gains taxes (potentially $1,000’s of dollars) but may also lead to steady monthly income from the sale of natural resources.