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Make Money In Real Estate
By Priya Jestin, Staff WriterThe real estate market is anything but constant. It keeps changing with the current financial trend and many people wonder how they can make money in this field. While many people will vouch for the fact that real estate is an extremely productive placement of investment dollars over time, others may have burnt their fingers in their attempts to make money off it. Before you enter this field, it is important to know the rules of the game.
One of the ways you can make money off real estate is through 1031 exchanges. But unless you know how to play the game, you could be in trouble. So, what exactly is a 1031 Exchange? According to Section 1031 of the Internal Revenue Code, a real property owner who sells his property and then reinvests the proceeds in ownership of like-kind property is able to do so and defer any capital gains tax.
For a property exchange to qualify as a like-kind exchange, it must be done in accordance with the rules set forth in the tax code and treasury regulations. Frequently, the most difficult component of a 1031 Exchange is identifying replacement property within the first 45 days following the sale of the relinquished property. The IRS is very strict in not allowing extensions.
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