Real Estate Broker · Columbus, OH · Member since 2019 · 119 posts · 151 votes
I have an owner who is interested in selling a building to me but wants to identify another property before he signs a contract (to avoid a large tax hit of $100K+). Obviously the easiest route would be to find him a property (which I am in search of), but wondering if anyone has had any luck in pitching some sort of strategic seller financing options or other options that could spread out his gains and/or reduce the tax hit. Any input would be much appreciated!
I have an owner who is interested in selling a building to me but wants to identify another property before he signs a contract (to avoid a large tax hit of $100K+). Obviously the easiest route would be to find him a property (which I am in search of), but wondering if anyone has had any luck in pitching some sort of strategic seller financing options or other options that could spread out his gains and/or reduce the tax hit. Any input would be much appreciated!
Just do a Lease Option. It satisfies his needs if written up properly.
@Mike M. Thanks! Can you elaborate on, “if written up properly.” ? I have never executed a lease option before.
And YOU shouldn't do it. You should have your attorney write it up. Basically you want the option for the length of time it takes him to find a 1031 exchange property it looks like to me. An attorney would word it so that it's acceptable to your state and to the IRS. "Don't try this at home". ;-) Let the attorney take care of the agreement, just tell him what you are trying to accomplish.
@Chad Kolinsky interesting. What is the process for something like that? How can I go about researching an option/what should I be looking for? Thanks for the insight!