All Forum Posts by: Shane H.

@Dave Foster & @Michael Plaks  Thanks so muchfor talking through this - I'm learning and I'm sure at some point someone else will stumble on this as well and help them.  Thats the great thing about BP Nation.

So Dave to make sure I'm understanding a possible solution - quiet title can be done so JS owns lot 1 - "A LLC" owns lot 2 and we are no longer TIC thus dividing up our ownership interests cleanly.

Then my builder could take title to lot 1 owned by JS....I identify Lot 1 and the proposed building to be built on it as one of my exchange properties.

I take the construction loan in the name of "A LLC" and take draws paying Builder Bob to build the duplex - he can use the draws to pay JS off for the land - he finishes the duplex in 4 mos - then I get perm financing and through the qualified intermediary A LLC takes title to the finished newly constructed duplex?

Hello,

I have seen the assisted living topic thrown around a lot on this forum since I've joined up and have to give much credit to having found and participated in this forum to becoming an owner of a licensed 41 bed assisted living facility in KS, quitting my W2 job and the whole 9.  Became an owner officially Oct 1 so am 2 mos in at this point.  Maybe I'm still in the honeymoon phase but haven't been happier. :)

Are there any others on this forum like me?  (I'm not seeking a pat on the back or humblebragging at all as I've just started and have a long road ahead of me) - I simply need help and want to find others like me to help them as well.  Maybe this isn't the place but figured I'd start here.  Networking and participating on this site helped me leap to where I'm at now and figure I need to dig in more to move forward.

As I type this I just got back home from being gone over an hour helping one of our staff shut down our archaic fire sprinkler system.  Fingers crossed the sprinkler company comes out tomorrow to help me get it back online so our staff can go off firewatch.

I think I'm (or maybe I'm not) a relative enigma to some in this field as I had no prior experience in this field other than seeking out others in this business and learning a lot from my wife who's worked at the ground level in the industry.  I need to learn more in order to grow.

Right now we are having issues with some of our staffing.  I've got some recruitement ideas but if anyone is a staffing expert I need to learn how to ramp up our recruiting efforts so we can better reorganize and upgrade our team.  I cant make any moves now with out proper recruitment and systems in place.  My 1st step is implementing a proper time clock system, then security cameras.  Once the time clock system is turned on (I think I've identified one) I can start the reorg - which will hopefully start in Jan after the holidays.

Anyways I've got a # of problems I need to solve and would be great to speak to others in my shoes.  And believe me once I learn more I'd be glad to share with anyone else wanting to learn more.  Be patient with me and I hope to have some things to pass on to others later.  Hoping this is facility 1 of a future expansion to this one and further purchases in other communities.

Anyone actually active in this industry I'd love to talk to you and brainstorm.  I can try to help anyway I can as well.

So JS could not sell his 50% interest in the 2 lots to "A LLC" -- this stuff should be simple or maybe it is but I feel I'm making it too complicated...ha

Also could I Shane H - sell my former primary residence that I've placed in service as a rental and have a tenant in to "A LLC" for fair market value?

I've seen and researched a # of scenarios involving these exchanges but not these particular scenarios - about the only way an exchange involving new construction seems "easy" is if you can pay cash in the exchange then it'd be easy to get a qualified intermediary to take the risk and get the place built. I may have to give up that idea for now if I cant do it involving a related entity or as has been pointed out since "A LLC" owns 50% of the land already it may not be a qualified exchange.

What if.... "A LLC" via a few strokes of paperwork at the title office takes ownership to Lot 1....JS takes full ownership to Lot 2 -- then "A LLC" could buy the lot from JS via an intermediary and exchange? (I guess I forgot to mention there are 2 lots - we just had it set up where A LLC and JS were 50/50 owners of both)

I can see where you are coming from but my full intent is to rent my former primary residence for 2-3 years and I also plan to transfer ownership of it into "A LLC". I hadn't thought about the holding period for the other property but have been told there is no holding period and I am netting no profit from the sale. Simply transferring my basis somewhere else. I've informed the title company who also acts as the intermediary here that I am planning a 1031 - so far no pushback.

Will have to run by them selling my former primary residence to "A LLC" and see if that will work. Will solve my problems. If not I'll end up buying something else. Have another property or 2 in mind.

Sorry for my duplicate reply - was trying to reply to your questions in a quote but that didnt work well.

Trying again

1. I assume that you have owned your current duplex for some time, that it was a rental and it is currently under contract to be sold (as opposed to under contract to be purchased)

Yes your assumption is correct but not the time of ownership --- Duplex I am selling was purchased in September - I bought this duplex to complete a 1031 exchange on a duplex I had sold April 2017 and owned since 2006 with a sizeable (to me anyways) capital gain and depreciation recapture.  So I'm just wanting to transfer my basis into something else.

2. It is also my understanding that the land is owned 50% by "A LLC" and 50% by JS. --- YES ----

3. 1031 has to have the same owner on both ends, so you can only 1031 within "A LLC" --- I understand this - ultimately I want "A LLC" to own the new construction duplex - what I was inferring is possibly I could take the construction loan in my personal name then sell it to "A LLC" when it's completed and ready to be placed in service.

4. If my two assumptions are correct, "A LLC" will be exchanging its current duplex into a combination of 50% interest in the land (purchasing it from JS) and a duplex to be built by "A LLC" in the future. Your existing 50% interest in the land will stay outside the exchange.

Yes

5. The above scenario is possible but complicated. Need help from 3 professionals: a 1031 intermediary, an accountant and a lawyer.

6. If a 1031 is planned, you must engage a 3rd party 1031 intermediary (like @Dave Foster) ASAP, and absolutely before you sell the duplex.

A 1031 is planned - but If it's too expensive to 1031 into a new construction property I'll just find something else to 1031 into. There is a title company locally that will / can act as the intermediary - however the complication comes in the form of new construction.

RE the personal residence -- It is my former personal residence - we moved out Oct 1 - it is now rented and someone will move in Dec 1st.  So it will have been placed in service before the sale will close on the duplex.  Related entity exchange permitted in this scenario?

A 1031 is planned - but If it's too expensive to 1031 into a new construction property I'll just find something else to 1031 into. There is a title company locally that will / can act as the intermediary - however the complication comes in the form of new construction.

Hello 

I presently have a duplex under contract and am hoping it will close sometime in December.  I'm planning to 1031 the sale into another property.

My ideal situation is to 1031 this duplex into a new construction  duplex.

Question is how do I do it?  I've already been approved for a construction loan and I own the lot.  Here are the details.

Duplex Im selling is owned in entity "A LLC" which is a 2 member LLC and I'm a 50% member, other member is my dad.

Ive been approved for a construction loan based on the financials of entity "A LLC" - however I could also get the construction loan in my name only, or another single member LLC that I am sole member of or Entity "B LLC" which I'm a 50% member of or when I close it down can transfer ownership to me solely.

The land is owned free and clear - land is owned under entity "A LLC" and is also owned half by John Smith (friend of mine...John Smith who coincidentally wants out)

How do I do this...I've been reading up on related entity exchanges but as I type this out am wondering if I couldnt complete this since the lot is owned by entity "A LLC" which is also selling the existing duplex.

Disclaimer for any that answer - I understand you are giving advice and I am to complete my own due diligence and consult my own professionals.

Thanks!!!!

(Other option I'm wondering is I just moved out of what was my primary residence for the past 11 years and will be buying a new house. Could I sell my primary residence owned solely by me - to Entity "A LLC" (which I'm a 50% member) as part of a 1031 exchange?

Fletcher, just to clarify I read your post right - you've made $200k in appreciation gains on a townhome in 3 years or so?  I guess my KS mind is blown - there are very little if any appreciation plays here - much less making 6 figures.

I'd have to be even more worried you're making that sort of a gain on a town home that the bottom is due to fall out of the RE market again.

Tell them about it and suggest they get on here!!  :)

@Dustin Hawks @Nasson Raymond @Christopher Stemler

I can usually arrange my schedule however I need to.  Will be pretty busy Thanksgiving week, but open to meeting up individually for lunch coffee or 2 or 3 of us etc.

Can volunteer the large office area we have in our lower level  - maybe some of you guys/gals could help me come up with an idea on what to do with it.  I was wanting to copy something a distant aquaintance did in Wichita by using his extra space as a startup hub of sorts - basically let folks apply to use the space and let them use it for free as long as he got a cut of anything they produced or was able to use/try the product.  (He was in the commercial construction space) - his building had more energy going on around it, as it was in DT Wichita.  Topeka has some nice DT blocks but for some reason in the short time I've been there it seems completely dead after 4pm or so.

We are near 29th/Gage backing up to the Shunga park - so if I clear out some of the brush on the back property line we'd have better views, but thats what I could offer...that and the pet turkeys that seem to roam around all the time...ha.

Email me or message me here and we can exchange cell #'s - have done so with a couple of you already.