Opportunity ZONE HELP!!!!!

[Jessica Kirkpatrick]

Hello, 

I need some help understanding the new tax laws. 

My client wants to sell his 5+ unit for $600K and buy a house w studio for his art business with proceeds. Right now he'd have to pay $120K in capital gains (20%). Of course he's looking at ways to avoid this. He doesn't want to do the 1031 exchange - he's cashing out and buying investing in his family. Though he did mention opp. zone. There are opp. zone, but before I start searching in those areas to buy, I'm confused or need clarification on the following:

1. can he sell a multi-family and buy residential/ mix-use in opp. zone to take advantage of opp. zone.

2. if he held onto for 10+ yrs, what capital gains would he have to pay?

Additionally, it's my understanding, there is a lot of uncertainity with this program, so the tax benefit shouldn't be the primary driver. 

Any other comments would be appreciated! 

Thanks!

[Natalie Kolodij]

Originally posted by @Jessica Kirkpatrick:

Hello, 

I need some help understanding the new tax laws. 

My client wants to sell his 5+ unit for $600K and buy a house w studio for his art business with proceeds. Right now he'd have to pay $120K in capital gains (20%). Of course he's looking at ways to avoid this. He doesn't want to do the 1031 exchange - he's cashing out and buying investing in his family. Though he did mention opp. zone. There are opp. zone, but before I start searching in those areas to buy, I'm confused or need clarification on the following:

1. can he sell a multi-family and buy residential/ mix-use in opp. zone to take advantage of opp. zone.

2. if he held onto for 10+ yrs, what capital gains would he have to pay?

Additionally, it's my understanding, there is a lot of uncertainity with this program, so the tax benefit shouldn't be the primary driver. 

Any other comments would be appreciated! 

Thanks!

This is something your client's CPA should be advising him on, not his real estate agent.