Father is selling his business, what are his best options with the new money

[Matthew Vanden Avond]

Hi Gang,

My father is retiring and selling his business/property. I'm trying to think of the best ways to 1.protect the income from taxes and 2.create a good investment vehicle for his future retirement. He does have other funds set aside in an IRA (in mutual funds), so I'm hoping to get him to diversify and see the light in real estate. He used to own and manage several 2 family units, but it became to time consuming.

From my years of enjoying and researching this forum, I believe rolling the money into a 1031 exchange would help shield it from the taxes. My thought for an investment would be either 1. buying a nice 2 unit ouright and manage it himself with minimal effort or 2. using it as a down payment on a larger multi unit property and paying a property manager, but hopefully gain a larger monthly return.

I've learned alot from this forum...that's why I'm coming back and picking the brains of the great minds here. Any thoughts or suggestions are appreciated!!

Matt

[Jon Holdman]

A 1031 exchange is only for like to like investments. Selling a business isn't a business, so a 1031 doesn't apply.

If he's already been in this business and got out is he really interested in getting back in?

Personally I'm very leery of giving investment advice to family unless asked. Depending on his situation, a very low risk investment may be more appropriate than real estate.