1031 Exchange

Sample 1031 Exchange:


An investor sells their California property after holding it for 15 years. They sell it for $1M after buying it for $545k. They now have $455k in taxable gains. Instead of paying taxes on that $455k, they decide to '1031 exchange' those funds through an intermediary, into 7 houses in Indianapolis. These homes are all rehabbed and rented with an average rent of $750 a month. They are now earning gross $5,250 or $63,000 a year or almost 14% in gross rent on their $455,000. Of course, standard rental homes’ expenses come out of that, such as taxes and insurance, property management, vacancy and maintenance. Even with those normal expenses, they can experience cash flow on day 1!

If you are:

  • Considering a 1031 exchange
  • A financial planner / CPA helping a client learn about choices
  • Have already completed the sale of your initial property

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ideas and strategies. We enjoy these, but they are time-sensitive, contact me ASAP.


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