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1031 only option?
I had intended to sell about $5.3MM of rental property and simply use the profits to may off debt on other notes. However, I'm told my tax basis will be close to $2MM after depreciation recapture.
Does anyone have any ideas on how to minimize that tax liability and still continue with my original intent, or is my only option a 1031 (I'm aware of DST but don't see that as a great option).
If so - any thoughts on rolling the profits from residential multi family sale into a commercial office building? Is office still underperforming or is now seen as a safe investment again?
#4 Real Estate Agent Contributor
- Rental Property Investor
- Hanover Twp, PA
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#4 Real Estate Agent Contributor
- Rental Property Investor
- Hanover Twp, PA
@Jacob Campbell, a couple thoughts:
Why do you want to pay off this other debt? Is it at a high rate of interest?
If your goal is to hold fewer investment properties of a different type, why not sell MORE properties and 1031 exchange into all new properties. For example, if you wanted to sell property A to pay down the mortgage on property B, instead sell BOTH A & B and 1031 exchange into a new investment property C!