One of the helpful rules on the federal tax books is the 1031 Exchange. It allows a business selling one property to buy another property at a higher value without paying taxes on the profit from the sale of the first property. This is known as a 1031 Exchange.
If you have a rental condo or a rental house, it can be treated the same way for a 1031 Exchange. This does not mean your own personal residence, nor does it mean a second home that you occasionally use. It has to be a rental property that you own and treat solely as a rental property. There are certain rules that you have to follow, but you can definitely defer quite a lot of tax money. Your CPA can go into the details, just follow them and collect the tax savings.
So give this some thought next time you are buying or selling a rental property.
Our agents here at Sand Key Realty Sales & Rentals, Inc. are here to help you with your future. Please give us a call at any of our three convenient locations. 740 S. Gulfview Blvd., Clearwater Beach (727-443-0032), 309 Belleview Blvd., Belleair (727-461-4200) or 2701 Gulf Blvd., Indian Rocks Beach (727-595-5441).
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