Selling Real Estate without Paying Taxes

Selling Real Estate without Paying Taxes
Richard T. Williamson | 2003-04-22 00:00:00 | Kaplan Business | 232 | Personal Finance
The decline of the financial markets has led to a white-hot real estate market as investors move their money away from the stock market. As the transaction rate increases, sellers are discovering that there are some tax surprises associated with selling real estate; namely, that federal and state taxes can consume as much as one-third of the profit on the sale of a property. Fortunately, legal methods exist for deferring or eliminating taxes. Attorney and real estate broker Richard Williamson explores the various ways to avoid taxes when selling real estate. In nontechnical, plain English and using actual cases and client situations, he explains the options available to take advantage of tax deferral or tax eliminating methods, including: *Charitable remainder trusts *Family philanthropic foundations *Installment sales *Private annuity trusts *Self-directed IRAs *1031 Tax Deferred Exchanges Williamson discusses the pros and cons of each option and gives examples of how each method works in everyday practice. He also includes sample forms for estimating capital gains taxes and IRS forms.
Reviews
I purchased the book to plan my tax strategy when selling an investment property that incurred significant gain. The sections on CRUTs, Installment Sales, and 1031 Tax Free Exchanges were very helpful and thorough. It is somewhat technical information, but written in a manner that a layman (non-CPA) can understand. My only complaint is that he doesn't address the implications of the Alternative Minimum Tax (AMT) anywhere in the book, and it has become a VERY significant consideration for selling highly appreciated property. The other thing I noticed is that his evaluation of TIC 1031 Exchanges covers some of the risks, but neglects to mention that the vast majority of 1031 TICs include HUGE fees or loads. One I examined had a 20% profit to the sales company when the property was flipped to the 1031 investors. Most have 8% - 12% commissions to the salesman. Otherwise, I thought this was an extremely helpful book and I would recommend it...with the caveat that the reader get additional advice on the AMT.
Reviews
Is a tremendously informative resource and well written so that a novice in real estate can understand and must have. It was so helpful, I purchased 4 more to give as gifts.
Reviews
Understanding the tax implications of your investments is one of the most important things you can do as a current, or aspiring real estate investor. While Mr. Williamson's book will not make you a "tax expert" it will give you the foundational knowledge you will need in order to intelligently converse with your attorney/accountant, and to make wise investing decisions.



Chapters include information on: capital gains, tax basis, exclusions, exchanges, installment sales, and trusts. I have personally given this book to new agents in my company in order to familiarize them with the tax implications of real estate investing.



In the spirit of full disclosure, I should say that I am an attorney, real estate broker, investor, trainer, and author of another unique and highly readable book on real estate investing that can also be found here on Amazon -- The WealthLoop Series Beginner's Guide to Building Wealth Buying Houses: The Foolproof Roadmap to Real Estate Riches Without the Risks and Hassles of Landlording. Unlike many real estate investing books, it is written to be a genuine "How To" book that "takes you by the hand" and walks you through a step-by-step process for getting started in real estate investing -- investors across the country are giving it rave reviews. The book also includes sample leases, forms, and checklists, so that you can actually go out and implement the investing strategy it teaches as soon as you're done reading. You might want to check out the companion CD too -- The WealthLoop Series Beginner's Guide to Building Wealth Buying Houses (Combo Audio/Data CD): Author's Audio Commentary Plus Downloadable 32-page Marketing Manual, Checklists, Spreadsheets, and Forms.



A related program that's well worth checking out is:



The WealthLoop Series Beginner's Guide to Personal Wealth Creation (Combo Audio/Data CD): Audio Seminar With Downloadable 40-Page Action Manual and Active Link Library.



I believe that Williamson has written an informative book that's worthy of your time. Buy it if you are serious about making a success of real estate investing.
Reviews
This book answered all my tax and property questions quickly and precisely. It was well written and perfect for someone who is not a CPA or property specialist. Highly recommended.
Reviews
I have read a number of books about real estate tax planning, and this is by far the best. It is clear, to the point, and very readable. The author goes through the basics of how a capital gains basis is calculated, rules about stepping up basis, primary residence exclusion rules, etc. He then discusses various ways of deferring or eliminating capital gain consequences via 1031, installment sales, private annuity trusts, charitable remainder trusts and Roth IRAs. The chapter on private annuity trusts is one of the least known, yet most valuable strategies that exists. Buy this book!

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