Medical Debt Bankruptcy – Before Filing Bankruptcy Consider Debt Settlement

At one time if you had fallen into debt due to medical bills and could not afford to repay them then filing for medical debt bankruptcy was common. However today there are more options open to those suffering debt problems and they are typically less severe than bankruptcy.

Medical bills can add up to an enormous sum of money and if you suddenly become unemployed then you may be unable to find the money to pay off unexpected medical bills. In the USA, many of those who have filed for bankruptcy have done so solely due to medical bills. Before rushing into bankruptcy, you might want to consider taking on the help of a debt relief company and looking into other solutions, which are less severe.

Consider debt relief to reduce the amount you owe as an alternative

One of the things you may wish to look into is if a debt relief advisor may be able to get your debt reduced, which will allow you to pay off the remainder of the debt. While you may not be able to afford 100% of the amount you owe, you may be able to get this reduced by as much as 70%, which means that you have only to find 30% of your debts and can repay this in affordable monthly repayments. This can be a very effective, powerful and sensible way to clear your medical debts.

Medical debt bankruptcy should really only be considered as the very last resort. When you file for bankruptcy, even if it is only due to medical bills, it will stain your credit rating for a very long time. This may mean that you are unable to borrow in the future or if you find a lender willing to take you on, you may have to pay very high rates of interest.

In summary, you may be able to write off up to 70% of your medical debts and pay them off rather than filing for medical debt bankruptcy and have your credit rating affected for a long time. When entering into a debt solution it is essential that you keep up with the plan, even if you are unemployed and are looking for work.

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Using Bankruptcy Medical Bills To Your Advantage

Nowadays, medical treatments are priced five times more than they are used to be, even when you acquire them in the less expensive and less popular hospitals. Although people tend to avoid going to hospitals as much as possible, especially those who are without health insurance, there are circumstances that still lead them to the hospital doors. If truth be told, filing for bankruptcy medical bills is not a bad thing. In fact, it is considered to be an ideal financial option for those who are unable to pay their medical bills. Here’s how you can make the most out of bankruptcy.

Tip #1- Ask for the detailed hospital expenses. Even in the age of computers, it is still possible to make mistakes. Hence, it is important to ask for an itemized list of your hospital bills. This way, you can ensure that you’re paying only for the medical treatments that you have been given. You can also reduce the cost that the government has to pay once you file for bankruptcy.

Tip #2- Don’t be hesitant to ask for help. People tend to be scared of filing for bankruptcy. What they don’t know is that it is one of the best options when you’re faced with steep medical bills. You will no longer have to work on being qualified for various organizations and charity cases. In fact, you will no longer have to dread picking up the phone or receiving letters from the hospital or your creditors. Once you file for bankruptcy medical bills, most of your debts will be cleared, allowing you to live with a clean slate once again. However, it is important that you ask for advice and assistance from bankruptcy lawyers. They can help you keep the bankruptcy process as smooth-sailing as possible. They can also help you determine the right steps to take after bankruptcy has been filed.

You don’t have to be afraid of bankruptcy medical bills. It is a good option to turn to when you’re unable to pay hospital bills.

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Best Ways to Choose Wardrobe Sliding Doors

It is hard to believe that the mechanism used in lavish sliding entrances to patios, verandas and pool houses or the glass variety known as Arcadia doors used in upmarket office buildings is the same mechanism used commonly in bedroom wardrobes or armoires, even modest ones. Aesthetically pleasing as they are, wardrobe sliding doors appeal as much for their economy of space. Since they open sideways just like accordion doors used in the garage, there is no need to allot space as you would for a traditional door that swings forward or back.

The most common kinds of the wardrobe sliding doors are Pocket and Bypass. Pocket doors have movable panels that disappear into a compartment – a pocket – in the adjacent wall. Bypass doors have panels that move to either side so that they can overlap – or bypass – each other from the front or behind. In some instances, only one panel slides while the other is fixed. The panels are typically supported by a roller system held in place by concealed carrier tracks, which may be top-hung or bottom-hung.

Top-hung carrier tracks do not require matching floor tracks as they can sustain the weight of the panels on their own. On the downside, there is merely so much weight they can carry. Bottom-hung carrier tracks need the help of matching overhead tracks to stay aligned despite the gravitational pull. On the upside, they can carry as much weight as the ground can. They go on sale at similarly cheap prices in a choice of aluminum, PVC or stainless steel, the strongest choice. Corrosion-resistant and self-lubricating, the same materials are used for panel frames and door hardware like bearings and hinges.

Space efficiency is evidently valued in closet doors, which is why another common type is bi fold doors, in which the panels comprising each unit are gathered to the side in pairs just like folding doors are parked where the tracks end to create multi-purpose spaces. As for wardrobe sliding doors, panels are affixed to a roller system, which is what runs along the carrier tracks. Many shower, laundry, utility and study rooms also make use of sliding entryways.

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Bi-Fold Closet Door Design Selection Tips

Bi-fold closet doors dress up your closet space with fine lines, unique configurations and ea of use unlike any other replacement door you may be considering. Interior designers always make them an integral part of remodel because they know that with the right door hardware and a small investment they can easily fit them into the makeover budget. Home owners have picked up on this trend not only because it is inexpensive, but also because the average person will have great success designing a new wardrobe replacement for those old worn out doors.

It really doesn’t matter whether you are tackling a large walk in closet space or just trying to spruce up the average room for arriving guests. If you’re stuck in a non creative mode, just visiting showrooms or online company displays will get you on the right track and before long your creative juices will be flowing with all the possibilities. The creative side of you will marvel when you discover the functional aspects and budget conscious inspirations you’ll have that transform a room from a boorish area to a centerpiece of visual appeal. The simple way to make any room shine, multi-fold closet doors are a fashionable tend in the U.S. and many other countries where the home has taken center stage to lifestyle.

The design options are nearly endless when you consider the many door track and hardware accessories you can combine with materials that come in acrylics, wood, metal, molded inlays and other features that bespeak luxury in the simplest designs.

For a more sophisticated home you can add to the design mix mirrors that reflect the inside of the room or bring light into areas once unusable. The architectural designs, the framing and tin etchings are so easy to install that you won’t believe the results yourself.

Pre assembled kits are available with pre drilled holes, and standard fits for easy replacement and custom designs that are commonly sold today even though the market is more tuned to the standard configuration. Getting that sleek look is readily available as manufactures have realized that home improvement can be done in stages if the right products are available for the do-it-yourself re-modeler.

When you stop and think, closet doors are probably the most used door in the home. Casual viewing of personal items is never a desire when guests arrive. We want these items readily available, but not open to public view. This may include items such clothes, shoes, linen, toys, exercise equipment and a host of other things common to the home.

The once forgotten closet door has evolved to become a part of the overall home decor. We want them to reflect our homes beauty, create a mood within a room and represent a piece of part of our personality just like the rest of the house.

As you review the multi-hardware kit options, systems, pulls and sets available consider the following:

Size should be the first consideration. Depending on your skills this can destroy the DIY project faster than anything else. Ideally, you want the same size replacement.
It is easy to replace a few panels that are pre-measured and are basically remove and drop in. However, if the closet is walls length then you’ll need to take a few extra steps with cascading tri-folding doors, so everything lines up properly when the job is completed.
As in real estate location is also important. A multi-fold door in an adult space would have different features than one placed in the children’s room or recreation area. So take into account safety, height and hardware before deciding on a design.
The next most important consideration would be what you plan to store in the space. Will the door be continuously opened and closed or will it be used occasionally? Whichever the case take this into consideration.

These four questions are a good start point. However, you’ll also want learn how these doors operate.

Multi-fold doors are installed as panels. The materials are the same in all panels. Their interlocking nature is configured by hinging them together. This allows them to operate like an accordion at the long edges. The louvers require near precise alignment when assembled. It’s a simple operation, but can be handy if you can visualize it before installing the doors yourself.

They stack against each other via door passing over door to neatly come together in a corner of the space. This allows them to fit better in smaller spaces than typical sliding closet doors.

The main advantages of these doors are they allow full view of the closet insides when they are opened fully. No more sliding doors from side to side to gain entrance into one side of the closet, only to realize that what you are looking for is on the other side. And the middle part of the closet is almost inaccessible. Bi-fold closet doors solve this problem since you now have full view of the closet just by pulling open one panel.

You can strategically place furniture in and around the doors since they don’t swing out and crowd the space. In urban areas, apartments and smaller homes this is a big advantage and utilizes the space more efficiently. Overall, these doors look great even when open. So you get to enjoy the aesthetics, functionality and ease of use as these doors bring a fresh perspective to the space.

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The Outlook for British Virgin Islands Real Estate – Predictions and Opportunities

The unlimited recreational activities in BVI include tennis courts, horseback riding, mountain trails and coral reefs. The climate of BVI is sub-tropical. The winter temperature ranges from 22-28 degrees while in summers it stays around 26-31 degree centigrade. The total population of BVI is 20,000.

The economy has been very stable for BVI which has been a major driving force to attract the investors to the real estate in BVI. Along with financial services, the tourism industry has played a major role in developing the economy of this island. The total national income comprises of 45% of tourism income and BVI attends almost 350,000 visitors. These visitors are usually from Canada and USA. Due to the interest of tourists, BVI has developed sound and secure international listings to give various options including villas, cottages and condominiums with very attractive international rentals.

Over the last couple of years, the financial distress led to the melt down of setback as well which also affected the banking sector. The major sufferers were European and North American investors that are still struggling with their economies. Many banks in EU have not been able to pass the stress test which clearly indicated the distressed economy for this year too. However, this huge downfall in the internal real estate did not affect much on BVI which shows a positive trend for BVI.

The international real estate for sale includes a large number of options from BVI due to the following reasons which prevails on this island hence making it a most wanted place for tourism:

1. The GDP per capita and standard of living has been maintained along with stable political infrastructure in BVI.

2. The economy of BVI is exempted of any company, capital gains and personal taxes which are highly attractive for the investors. Along with this, the BVI rentals and very low property tax has been able to create a good exposure for the investors in BVI. For this reason, the international real estate exchange has been maintained in order to give more housing opportunities to investors.

3. Even though the real estate in BVI is very small and insignificant but the presence of landholding license system has helped develop a sustainable BVI for sale.

After the evaluation of these factors, it becomes clear that no matter how much the economy for adjoining British and North America is distressed, the BVI listings will always have the best property buying options. Even though the island is small and the demand exceeds the supply, but still BVI has been able to offer a lot on the international real estate for sale platform. The international agents are pretty much hopeful about the sustainability of the property industry in BVI.

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Tax Deferred Exchanges of Investment and Business Real Estate

The Primary Residence taxation, the Residential Replacement Rollover, Sec. 1034 exception is gone. Previous capital losses still apply, if the property is held as investment property and sold at a loss and that loss can be carried over for up to 7 years. For those over age 55 the primary residence or residential sale exclusion of taxation is gone. Tax deferred exchanges remain a viable way of deferring taxation on investment real estate.

It is required to analyze and pre plan prior to transaction. That analysis must be done by an updated tax deferred exchange professional such as those we have on retainer. Not only do you need a tax attorney, but a real estate attorney, and an expert attorney working with them – that is a specialist in only tax consequences; especially those of tax deferred real estate transactions. There must be proper forms and written documents before the transaction is done. This requires planning and a review of limitations as well as a formal and professional critique of assumptions and decisions.

Most Realtors, Attorneys and CPAs do not have sufficient expertise to guide you in a legitimate and defensible tax deferred exchange. The key here is defensible, as the IRS will usually audit the tax deferred transaction and if it’s done correctly so that it is easily defensible you will sail right through the audit for little or no money. Your personal tax profile and that of your other business and family identities must be factored in the decisions. It may be necessary to legally refigure, adjust, and compartmentalize your purchase or sale – and document that appropriately, BEFORE you begin to put any part of the transaction in writing. Planning is legally done BEFORE and if it is done after the transaction you can be liable for fraud. The IRS does not take kindly to fraud especially regarding real estate.

For instance you must know your straight line depreciation factor; for investment property that is currently 39 years. For instance: Any depreciation taken during the ownership of the property will be picked up in a recapture tax upon the sale of the property.

Federal and State taxations must be combined properly, according to numerous factors that must be researched by your team of advisors. Since the total taxation on the gain is approximately 35% of the gain plus the recapture tax – your fees to professionals can be well worth it to you if they better your tax situation. The tax deferred technique can defer till later or eliminate your tax payment and consequence. Of course the only real and usual way to eliminate the tax is to die. There are ways to defer the tax however until that death. Tax deferred strategies are sometimes called alternative strategies or alternative tax deferment strategies.

Note: if you are speaking with anyone and they speak of TAX FREE EXCHANGE or TAX FREE SALE of your property, they are not well informed and thus you should be wary of any other advice they give you. There is, effectively, no such thing as a tax free sale or tax free exchange of real estate.

Exchanging is an effective tax planning tool. Large potential tax liability can therefore be deferred. And, there are savvy investors who have deferred taxation on millions of dollars of properties for decades and thus given themselves many millions of dollars of additional investment money with which to leverage their wealth.

Like kind exchange can now be defined as: any kind of real estate in exchange for any other kind of real estate.

We hear of qualifying property or properties – yes there can be more than two properties involved, in some cases there can be several and you don’t have to ever see or even know about the other properties involved. You will need good advice however, professional advice. This exchange of any kind of real estate for any other kind of real estate was not always true. This tax deferment alternative is not for everyone. Some owners should not defer.

We must realize, as well, that there is ALWAYS a risk of audit. The larger the dollars involved and the more suspect (according to the IRS) that the participants in the transaction are, the more likely an IRS audit of the procedure is. If there are several million dollars in tax deferment involved, and especially if one or more of the participants are considered audit targets by the IRS for any reason, you may become involved in an expensive tax audit. The cost of the audit, even if you are successful in defending your decisions, can be far greater than the tax deferments. And if the deferment is disallowed there WILL be penalties, fines, interest and even more substantial legal and accounting fees – plus an amended return in some cases which may trigger more consequences and even more audits. I hope I’ve made myself quite plain here – get good advice from legal and accounting specialists on these exchanges.

There is a time line, for several of the acts and consequences in exchanges according to the IRS. In addition to timing there are other qualifying or disqualifying situations and these situations include the use of the properties, before, during and after the transaction by those involved or their families, friends, associates, etc… In addition to the normal criteria for the exchanges, if Realtors, investors, attorneys, or those who buy and sell real estate frequently are involved in exchanges; the IRS makes special, more restrictive rules that will result in more scrutiny by the IRS. In fact the IRS can make up reasons why they think a person needs more scrutiny; that can include political affiliations, relationships to politicians, your social position, your affiliation with judges, and conspicuously wealthy or well known people and even your religious affiliations and charitable giving recipients. In fact, there can be a tax deferred exchange that will work for one side of the exchange and not for the other person or entity involved.

In addition the tax court looks at intent for use, investment, or purchase and sale — not only the use; past, present and future; of the properties involved but what they think may be or could be the uses and consequences based on all sorts of criteria and even hunches they may have. They also have extensive rules on what like-kind exchanges are. The exchange must also be interdependent. There may not be any receipt or control of cash or other liquid assets from the sale by any of the exchangers. This can be inclusive of debt relief as well. Any of these things will be taxed. In fact, a refinancing of any property involved within two years or less will disallow the tax deferment as well. There are also several time limits and timing criteria involved which must be allowed for and honored.

There are some specific terms; relinquished property and replacement property are the most important terms; after the most important definitive phrase of all: Like Kind Property Exchange. Large potential tax liability can be deferred; that is: NO tax is due upon receipt of the proceeds; from your investment in qualifying real estate, whether buying or selling, can be maximized by deferring the tax liability, the consequences, and using the deferred expenses. That is; you are saving and have the use of the tax money you don’t have to pay now, and you can invest that money in the next property, giving you a multiplied ability to invest and reap further benefits of appreciation and income. Therefore, you will have the additional money, and therefore additional down payment, to invest in an even larger property or pay cash for a more expensive property. This can change your life; your life as an investor, your business life, at least.

The exchange does not have to be simultaneous. You must in general; identify the property within 45 days and settle within 180 days.

There are also delayed exchanges, non simultaneous exchanges, which are sometimes called Starker Exchanges. There can be a buyer assisted, delayed, Starker exchange. This buyer assisted, delayed exchange, is done with the help of the buyer – by letting the buyer possess or even live in the property for a while. This is almost always a bad idea, a very bad idea. There is also such a thing as a reverse-Starker exchange. In a Reverse Starker Exchange the replacement property is acquired before the relinquished property is sold. These are rare, unusual, possible and legal – but not to be considered lightly without adequate counsel involved in your every planning facet.

For the protection of all involved; the contracts, all exchange documents and paperwork should be prepared by specialists in tax deferred transactions. The Realtor should never, ever, prepare the exchange documents!

There are some additional factors and rules. You can name up to three possible properties in that first 45 day period. There is also a rule called the 200% aggregate rule where you can name several
properties up to but not more than 200% of the value of the relinquished property. Property held by a person who deals in property does not qualify. Personal residential use property does not qualify. Partnership interest in property does not qualify. Refinanced property will not likely qualify if it has been refinanced in the last two years. The property must ordinarily be held for investment and generally acquired and held for appreciation and for production of income such as rental income.

Let’s now look at the sale of personal residences. The gain on a personal residence has no tax due on the first $250,000 of gain for one person or $500,000 tax relief for a couple. A principle residence is one that a person resides in for 183 days per year or more and no other. Factors which determine a person’s principle residence are four; each showing the same residential address of that being claimed: A Driver’s License; Magazine, Newspaper, and Internet Subscriptions, Utility Bills such as Cable TV, Telephone, etc. that are mailed to and show the address as residence, credit card bills, checking and savings accounts, voter registration card, personal telephone listing in the white pages.

There are many pages of rules, regulations, code, determinations, tax code, rental and vacancy rules, abandonment according to prescription, determinations of intent, various capricious factors known only to particular IRS agents, time lines, divorce issues, temporary use, rental, vacancy, or abandonment issues, documented or discoverable intentions on the part of participants in the transactions, multiple dispositions in short periods of time, work related occupancy and vacancy requirements, personal business use of property, income streams, family uses, health related and documented residential move or vacancy requirements, court cases and other recorded facts, all manner of special requirements and issues, land installment contract provisions, miscellaneous extenuating and defensible contingencies – which will affect the bona fide legality and defensibility of a tax deferred transaction. There are many points upon which your planning should be based. There are some emergency planning techniques as well.

You can even take some improvement expenses and take a fix up expense for work done to sell the house. You MUST have: Written affirmation of necessary expenses that are needed to sell the property. Be able to prove the work was done within 90 days of the executed contract of sale. There is also, now, a maximum of 20% taxation on the taxable portion of the net gain on the home. Generally tax laws are applied separately to each individual owner or co-owner of the property and each must meet requirements separately and individually.

Take care. Be prepared. Educate yourself and ensure that your advisors are as well. Be legally and financially, well represented and very professionally and personally wary.

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End Note: The above article was written in the form of notes during a class I attended on exchanges that was delivered by SEVERAL full time professionals in the business of ONLY these types of exchanges. These notes are to be considered guidance in the form of alarming you to the point of getting proper counsel only. You may know the exchanges of Real Estate as Starker Exchanges, 1031 or 10-31 exchanges or even as “tax free” exchanges. They are NOT tax free, they are tax deferred! Be careful.

Do not use the information in this article to make your final tax or selling or buying decisions. This information here is to give you enough data to begin thinking about deferred tax – exchange of real estate.

Do not make any decisions or write any documents based on this information. Get specialized legal advice from experts in this exact business; not from unspecialized attorneys or accountants – and especially NOT from general Realtors such as myself.

Ask to see the credentials of anyone who seeks to advise you, they will have them or not, exact and specific credentials, in writing, of their professional ability to serve you. If not, chose another professional to help you. In fact feel free to contact me and I’ll get you in touch with those senior professionals who are full time in this exact profession.

There are law changes frequently on these forms of transactions and as I write this 10-31-2001 there are several laws being discussed and perhaps voted on today that will change many of the factors involved here – hopefully for the best – in order to help bolster our economy even more and support the real estate business in which I work.

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Arrest Warrant Issued for Missing Real Estate Attorney

Missing Breckenridge Colorado real estate attorney Royal “Scoop” Daniel, age 61, is now a Wanted Man. Daniel was first reported missing from his Breckenridge office on April 27th, 2007. On May 8th, 2007 the Breckenridge Police Department obtained an arrest warrant on suspicion of Class 3 Felony Theft for Daniel in connection with his handling of his client’s 1031 Real Estate Exchange funds.

A 1031 Tax Deferred Real Estate Exchange occurs when a property owner sells investment real estate and uses the proceeds from the sale to purchase other investment real estate. In this case, the property owner does not pay capital gains tax on the sale of the relinquished property provided that the replacement property is of equal or greater value. Section 1031 of the Internal Revenue Code requires proceeds of the sale to be held by an intermediary third party until the replacement purchase is made.

It is alleged that Daniel, while serving as an Intermediary for 1031 real estate exchanges, used client’s funds to pay personal expenses and to fund the transactions of other 1031 real estate clients. One investigator described this as a situation of “robbing Peter to pay Paul” and that it caught up to Daniel to the tune of at least $500,000.

When Scoop was first reported missing on Friday April 27th, the belief throughout the Breckenridge community was virtually unanimous that he must have been the victim of wrong doing. Scoop has been a long time resident of Breckenridge and is beloved throughout the small mountain town. He was very active in a local church and did a great deal of volunteer work for a variety of local organizations.

These fears were amplified by information of a silent a nine second 911 call made from Scoop’s cell phone on the morning of his disappearance. Daniel also left his dog, car, keys, coat, and hat behind at his office.

That weekend over 150 volunteers, in conjunction with local authorities, conducted an extensive search of the area within a two mile radius of Daniel’s office and the nearby alpine trails. No evidence of any wrongdoing or Daniel’s whereabouts was found.

At the same time, Breckenridge Police investigated the possibility of Daniel’s willful disappearance. Police learned that Daniel had left a paycheck for his secretary on her desk on the morning he disappeared. He had never done this before.

Also that morning, Daniel gave a key for his residence to his girlfriend of five months. She found this odd because he never locked his door. Daniel also gave her some personal belongings which he said he would not need for awhile.

Investigations into Daniel’s finances indicated the he is in extreme debt and the he may have been illegally moving money into and out of his Colorado Lawyer Trust Account Foundation (COLTAF) client trust accounts, 1031 real estate escrow accounts, and his business and personal accounts to pay business expenses and personal debt.

On May 1st, 2007 a previous client of Daniel’s contacted the Breckenridge Police Department with information regarding a 1031 Real Estate Exchange transaction from a year earlier. The client stated that he had given Daniel over $250,000 in trust as part of the transaction and that when the time came to produce the money, Daniel could not do so, admitting to having used the money to pay other people’s 1031 monies and that he was $300,000 in debt. The client also stated that Daniel eventually paid him most of his $250,000.

Since the initiation of the missing person case on April 27th, 2007, the Breckenridge Police Department has been contacted by seven of Daniel’s clients indicating that Daniel was holding 1031 Real Estate Exchange funds on their behalf. Information provided by just four of these clients indicates that Daniel should be holding at least $561,571 of 1031 Real Estate Exchange funds in trust accounts. Less than half this amount has been discovered in all of Daniel’s various personal, business, and trust accounts. Breckenridge Police expect that records from the remaining three clients, as well as others yet to contact authorities, will widen the discrepancy in coming days.

Despite these recent findings, many members of the Breckenridge Colorado community continue to believe that Scoop would never have created such a situation of his own accord and that he is not a willing participant in it. This is a possibility which authorities have not ruled out.

Copyright 2007 – All rights reserved by Ted Amenta

Notice: Publishers are free to republish this article on an ezine or website provided the article is reprinted in its entirety including copyright and author information, and all links remain intact and active.

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Know Everything About the 1031 Real Estate Exchange

The 1031 Real Estate Exchange is a dynamic tool for real estate investors and helps to defer the capital gains tax for a long while.

The 1031 Real Estate Exchange is applicable when using the sale of income property to purchase another income property. The sale and purchase must be completed in a specified time period.

You, as the real estate investor can never have any control over the proceeds from the real estate sale. The money from the sale of the first property is placed in trust with an intermediary. This intermediary is supposed to collect and hold the money from the buyer of the first property and transfer it to the seller of property number two. In recent years, however, there have been problems with the intermediaries.

Some of the intermediaries have been disappearing with the money they were supposed to be transferring. Others often co-mingle clients money into one account. If there is a problem with a single transaction and those monies from that transaction are frozen, everyone else’s money in that account gets frozen along with it.

The transfer of the money from sale to purchase must take place within 180 days for the real estate investor to avoid capital gains tax. If the intermediary does not make the transfer on time, the real estate investor is assessed full capital gains on the sold property.

The 1031 Exchange is a great opportunity for real estate investors, and many more of them should be taking advantage of the tax break. There are, obvious drawbacks to tying your money up in a 1031 Real Estate Exchange, but you can address the risk potential.

To lessen the risk of your money getting stolen or frozen, you can insist that the intermediary deposit your funds in a single account, with no ties to the intermediary’s personal funds or any other exchange dealings. Then simply see that the account is labeled so as to have your (the investor) name, social security, or tax identification number tied to it with a provision that the money is for the person to act as your intermediary. You can do this without being considered in possession of the money or in violation of the exchange restrictions. All it takes is a trip to your bank with the intermediary to set it up.

Dealing with your bank, rather than one chosen by the intermediary, makes the holding of the money prior to transfer a less risky operation for you. Your bank knows you and will realize that this money is being held for you and will only be released by the intermediary to buy your income property.

By doing this, you are better guaranteed that the money will securely pass from the intermediary to the seller without any funny business.

When you sell your property the liability of capital gains is a big issue. There are some ways available to defer this liability. 1031 Real Estate Exchange is a very useful method. But you should use it very carefully. Chintamani Abhyankar discusses precautions while using this tool.

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1031 Real Estate Exchange And The Importance Of A Qualifying Intermediary

A 1031 real estate exchange can provide great benefit to your financial net worth and is one of the most important tools in a real state investors’ toolbox. This article will specifically focus upon the importance of choosing a very good qualifying intermediary and what factors you should consider when deciding which one to work with.

A qualifying intermediary is the most critical piece of the puzzle when looking at doing a 1031 real estate exchange. These are professional companies will ensure that you satisfy all of the IRS regulations regarding doing your exchange along with holding the money in escrow until you have found the properties which you will exchange. If certain guidelines are not properly followed, you can lose your ability to do a 1031 tax exchange and have to pay the financial consequences so be sure to do your due diligence.

Many of the same factors which you’ll probably look use when searching for a new business partner will come into play when choosing a qualifying intermediary. You want to first check on the track record of the qualifying intermediary. If a company has been around for about 10 years, that is a good sign. The IRS clarified its guidelines regarding 1031 real estate exchanges in 1991. If the company is over 10 years old that means it has seen the changes in the industry and has considerable experience. You also want to check on the background of a company and where it operates. If you’re looking for a property in Alabama and a qualifying intermediary you have spoken to has never done a 1031 tax exchange in Alabama, you’ll probably want to consider using a different qualifying intermediary. You want someone who has the experience and the track record. You also want to see what kind of support and help are available with this company. There are very tight guidelines regarding when you identify properties as well as when you buy these properties so you want to make sure that there’s enough help so that you will meet the guidelines. Also use a qualifying intermediary who uses strong security features and reasonable fees. Make sure to talk with several qualifying intermediaries to compare some these factors. Finally you should try to get a couple of references from the qualifying intermediary to make sure that they have done good work for other people in the past. If the company refuses, do not hire them.

A qualifying intermediary has a very important part within this picture and you must work to find the one to do business with. This may well be the most important decision you make throughout your work on a 1031 tax exchange.

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