Slideshow Transcript

1. Slide 1: Call Us Today at 866-405-1031 www.1031alternatives.net The 1031 Solution “A Tax Deferral Strategy For Highly Appreciated Real Estate” Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
2. Slide 2: Call Us Today at 866-405-1031 www.1031alternatives.net If Your Investment Real Estate Is Currently… • Highly appreciated • Fully depreciated • Management intensive • Under/over diversified • Not providing enough cash flow Then maybe it is time to consider some options Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
3. Slide 3: Call Us Today at 866-405-1031 www.1031alternatives.net You Have Several Options To Choose From You can… • Do nothing • Sell property, pay taxes, and reinvest net equity in standard investments • Exchange property for like kind real property utilizing an IRS §1031 Exchange thereby deferring taxes • Exchange property for professionally managed real property utilizing a tenant in common (TIC) §1031 exchange Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
4. Slide 4: Call Us Today at 866-405-1031 www.1031alternatives.net The 1031 Exchange Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
5. Slide 5: Call Us Today at 866-405-1031 www.1031alternatives.net What Is A §1031 Exchange? • A §l031 Exchange is a transaction in which a taxpayer is allowed to 1031 exchange one investment property for another thereby deferring the tax consequence of a sale. The transaction is authorized by §1031 of the IRS Code. “No gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment if such property is exchanged solely for property of like kind which is to be held either for productive use in a trade or business or for investment.” Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
6. Slide 6: Call Us Today at 866-405-1031 www.1031alternatives.net History of §1031 Exchange • §1031 originally adopted into the IRS Code in 1921 • Refined over 70-years of case law and further guidance • Final regulations issued by IRS in 1991 Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
7. Slide 7: Call Us Today at 866-405-1031 www.1031alternatives.net Who Is A Typical §1031 Investor • Owner of rental homes • Owner of multi-unit apartments • Landowner • Farmer • Business owner selling business w/ real estate • Owner of small retail or industrial property Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
8. Slide 8: Call Us Today at 866-405-1031 www.1031alternatives.net Requirements For An Exchange To defer taxes under IRC §1031, the investor must: •Acquire like-kind property •Properties must be held for investment or use in business •Property must be of equal or greater value • Acquire equal or greater debt • Not receive cash or other benefits on sale of property (constructive receipt) •Follow strict 45/180 day timeline for exchange Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
9. Slide 9: Call Us Today at 866-405-1031 www.1031alternatives.net What Is Like Kind Property? • Like kind property • Non like kind property – Rental Houses – Personal Residence – Rental Condominiums – Bonds – Apartment Buildings – Securities – Shopping Centers – REIT Stock – Warehouses – Shares of Stock – Office Buildings – Vacation Homes – Raw or Unimproved Land – Interests in Partnerships – 30+ Year Leaseholds – Property Outside the US – Tenant In Common Interests Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
10. Slide 10: Call Us Today at 866-405-1031 www.1031alternatives.net Property Identification Procedures investor to review, and all the financing would be in place. You simply work with your advisors and then subscribe into the TIC deal that best •meets property identification must be delivered to the Qualified The your goals, objectives and risk tolerance. TIC ownership has given everyday investors a right of entry into an investment vehicle that Intermediary (QI) • Identifications must be in writing andby pension funds, insurance has been historically dominated signed by the exchanger companies, or ultra high net worth individuals. • Identification must be unambiguous (site specific) • Must be delivered within the 45-day identification period – no extension for Saturday, Sunday or holiday deadlines Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
11. Slide 11: Call Us Today at 866-405-1031 www.1031alternatives.net investor to review, and all the financing Timelinein place. You simply The Exchange would be work with your advisors and then subscribe into the TIC deal that best Exchangers are kept to a strict timeline: meets your goals, objectives and risk tolerance. TIC ownership has given 45-days to investors a right of properties an investment vehicle that • everyday identify replacement entry into • has been (total) to close on at least by pension funds, insurance 180-days historically dominated one of these properties companies, or ultra high net worth individuals. 180 Days* 45 Days Identification Period Exchange Period Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
12. Slide 12: Call Us Today at 866-405-1031 www.1031alternatives.net An Example Exchange investor to review, and all the financing would be in place. You simply work with your advisors and then subscribe into the TIC deal that best The Facts: goals, objectives and risk tolerance. TIC ownership has meets your given everyday investors a right of entry into an investment vehicle that •Property Owner (Bob) originally purchased an investment duplex for has been historically dominated by pension funds, insurance $250K. companies, or ultra high net worth individuals. •Bob has determined to sell the property for $1M after 5 years. •Bob has existing debt on the property of $125K. •Bob’s basis on the property is $213K after depreciation (based on a 27.5 year straight line schedule) •Bob will pay $70K in transaction costs on the sale Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
13. Slide 13: Call Us Today at 866-405-1031 www.1031alternatives.net Tax Calculations investor to review, and all the financing would be in place. You simply work with your advisors and then subscribe into the 250,000 that best Original Property Purchase Price TIC deal meets your goals, objectives and risk tolerance. TIC ownership has Improvements valued at 200,000 given everyday investors a right of entry into an investment vehicle that Land valued at 50,000 Depreciation historically dominated 5-years has been on 27.5 year schedule for by pension funds, insurance - 36,363 Basis companies, or ultra high net worth individuals. 213,636 Selling Price 1,000,000 Gain 786,364 Recapture Tax @ 25% 9,090 Federal Capital Gains Tax @ 15% 117,954 State Tax @ 0-10% (depending on State) – 5 % 39,318 Total Tax Liability $166,362 Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
14. Slide 14: Call Us Today at 866-405-1031 www.1031alternatives.net Possible Scenarios Scenario #1 Scenario #2 • Sell property, pay the taxes, and • Exchange property, defer the reinvest: taxes, and reinvest: Sale Price: $1,000,000 Sale Price: $1,000,000 Less: Less: Loan: $125,000 Loan: $125,000 Trans Costs: $70,000 Trans Costs: $70,000 Taxes: $166,362 $805,000 $638,638 Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
15. Slide 15: Call Us Today at 866-405-1031 www.1031alternatives.net More Possible Scenarios Scenario #1 Scenario #2 • If $638K investment receives a • If $805K investment receives a return of 7% annually for 7- years you will have: return of 7% annually for 7- years you will have: $1,024,488 $1,292,654 Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.
16. Slide 16: Call Us Today at 866-405-1031 www.1031alternatives.net Thank You! For further information or to receive a FREE handbook, please contact us: 1930 Harrison Street, Ste. 603 Hollywood, FL 33020 Toll Free . 866.405.1031 Fax . 954.874.4501 Accredited Investors Only Securities offered through Pacific West Securities, Inc. – Broker Dealer – Member FINRA/SIPC. This material is neither an offer to sell nor the solicitation to purchase any security. Purchases may only be made upon thorough review of risks and merits located within the Private Placement Memorandum or Prospectus. Pictures are not current offerings and are used for illustration purposes only.