Can someone do a like-kind Exchange on vacation property or second home... Inherited back in 2003 in NC at fmv of approximately 235,000... were Capital Improvements after inherited.... To be sold soon at 650,000... not rented at all, no days rented... it is for the sister of a client, but I'd really like to know for myself and I'm sure others want to know, did search online and manuals seems to be different scenerios/opinions... Thank you
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Personal use property is not eligible for a like kind exchange.
1031exchange is for swapping one income property for another...Im not seeing any income involved here.
Yes that makes sense... And why would you want to sell it and then buy another property? Unless it is for a different location or maybe that house is haunted?....
I always share with my clients the story of Nicole Simpson, who sold her San Francisco condo and bought one in Brentwood. She reported it as a 1031 exchange, even though neither were rentals. A few years later, her ex-husband OJ sent her a letter threatening to report her to IRS for tax evasion. A week later she was dead.
Personal use property is not eligible for a like kind exchange.
The real property (and yes, has to be real property now...) doesn't actually have to be income producing property. It *does* have to be investment property tho, and not something used personally.
Yep that's right....Found this: like-kind exchanges. No gain or loss is recognized if business or investment real property is exchanged solely for other business or investment real property of a like kind... The like kind exchange rules do not apply to exchanges of property the taxpayer uses for personal purposes. A vacation home or other dwelling unit may generally be treated has held for business purposes if: The taxpayer rented out the unit for at least 2 weeks in each of the two years before the exchange, and rents out the property received for at least 2 weeks in each of the first two years after the exchange, and the taxpayer's personal use of the units in those years is minimal....
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