| Q. |
May
I sell property in Florida and purchase replacement property in
Connecticut? |
| A. |
Yes.
All real estate located within the United States and its territories
are considered “like-kind” for the purposes of IRC Section 1031. |
|
|
| Q. |
May
I take some money from the sale for personal use? |
| A. |
Yes.
However, any money not reinvested in replacement property will be
taxed as a capital gain. |
|
|
| Q. |
If
I co-own property with someone else as "tenant-in-common"
must both proceed with the exchange? |
| A. |
No. You
can go your separate ways and reinvest your proportionate share of
the sale proceeds into replacement property. |
|
|
| Q. |
May
I use a business property for personal use? |
| A. |
Yes,
for a two week period or 10% of the rental use per year, whichever
is greater. Time spent on the property for business purposes (i.e.
maintenance, repairs, marketing, management, etc.) is not considered
personal use. |
|
|
| Q. |
May
I accept a
"note" from the buyer of my relinquished property? |
| A. |
Yes,
however the "note" must be used either directly toward
purchase, or converted to cash prior to purchase, so all assets
realized from the sale are used for the purchase of replacement
property. |
|
|
| Q. |
May
I sell one
property and purchase several, or vice-versa? |
| A. |
Yes.
Multiple properties can be combined within the exchange process as
long as the timing parameters are met. |
