All Forum Posts by: David Lee

Hi @Dave Foster, thanks for the prompt reply!  If I'm understanding it correct, and the prior rental periods factor into proration, then it would be (property 1) 2 years primary, 6 years rental + (property 2 via 1031) 2 years primary, 3 years rental for a total of 4 years primary and 9 years rental.  This equates to about a 30.8% tax free and 69.2% long-term capital gains tax.

For illustrative purposes (*simplified numbers*): 

1) If held another 2.5 yrs to meet the 5 yr mark, and let's say the gain is $300,000, then $92,400 tax free and $207,600 taxed at long-term capital gains rate.

2) If I sell now and let's say the gain is $300,000, then all $300,000 would be taxed at the long-term capital gains rate.

Therefore in this example the potential savings of holding is: $92,400 x LTCG tax rate.  If the rate is 15%, then that would be $13,860.

I hope I got everything right here?  Thanks again for your assistance!

Hi @Dave Foster, I am in a similar situation with a twist and have some add-on questions so I thought I'd add a reply here.  Apologies in advance if I should have created a new topic/post.  

Situation: I purchased a property about 11-12 years ago, lived in it for 2 years then rented for about 6 years at which point I sold it via a 1031 Exchange into a new investment property.  The new property was used as a rental for about 6 months, but circumstances changed and I ended up making it my primary for the last 1 yr and 9 months.  Again, circumstances have changed and I'm in a position where I need to decide whether to rent it out or sell the property.  

It sounds like if I sell the property now, I would not be able to benefit from the IRS 121 at all. 

Would it make sense to stay in the property another 3 months to achieve the 2 year primary residence requirement, then rent for 2.5 yrs to satisfy the 5 year ownership requirement and then sell to get the IRS 121?

Also, if do this and when I sell, what would be counted as far as primary vs investment/rental service time?  Is it a combination of both properties (4 yrs primary, 9 yrs investment) or only the 2nd investment property service time (2 yrs primary, 3 yrs investment)?

Many thanks in advance for your time and advice!

We are planning to list to sell our legal 4 family house in Hudson county near Lincoln Tunnel. But the process of getting a green card is being delayed too long. Now wondering if we should just list the house sold As-Is without a green card. 

The house is well maintained but there are always a few things to be done after the green card inspection but this process has been painfully slow (our inspection was Feb 2020 and we still haven't received a report). Do you think we will lose out by listing the house as is? Should we take our time (possibly months) to get the green card and then list the house? 

Also, anyone has a recommendation for a good selling agent versed in selling multifamily? 

Thank you. 

are looking for an architect/engineer to help us with the house in Weehawken, NJ. 

It’s basically related to our front steps. The town wants to see drawings/plans from an architect or engineer for the reconstruction of our porch/steps and a support system for the porch roof while the work is being done. This is happening early July and we need someone who’s reliable with reasonable fee. 

Any help/ referral would be much appreciated!! Thanks!

Hello. We are thinking about selling 4 family house in NJ (owned since 2009 and have about 500k equity in it at the current market price). My husband and I both have full-time jobs and been managing this property on the side somewhat passively (without putting in too much work/raising rents). It has a cash flow of about $800 per month - probably could go up more if it's managed more actively. But we are now wondering if It's better to sell the property as the inventory seems low. And use the proceed to invest in other markets. (thinking about Raleigh, NC). We do want to get into real estate investing more aggressively and think maybe this could be a good time to make the move so we can get properties with more value. But this house has been a good investment for us - easy to rent due to its close proximity to the city, almost zero vacancy - so we are having a hard time making a decision to sell. Would appreciate any advice! Thank you.