{"id":522,"date":"2014-06-25T00:39:10","date_gmt":"2014-06-25T07:39:10","guid":{"rendered":"https:\/\/shellyrobersonrealtor.com\/?p=522"},"modified":"2014-07-01T10:41:57","modified_gmt":"2014-07-01T17:41:57","slug":"most-common-real-estate-tax-audit-issues-in-2014-and-how-to-avoid-them","status":"publish","type":"post","link":"https:\/\/shellyrobersonrealtor.com\/most-common-real-estate-tax-audit-issues-in-2014-and-how-to-avoid-them\/","title":{"rendered":"Most Common Real Estate Tax Audit Issues In 2014 And How To Avoid Them"},"content":{"rendered":"

<\/h1>\n

Selling, Exchanging and Facilitating a Tax Deferral Strategy Requiring the Use of a Qualified Intermediary and IRC 1031 Requires Careful Planning and a CPA or Tax Attorney<\/h1>\n

Internal Revenue Code Section 1031 Like-Kind Exchange Audits continue to find non-compliance in some common areas.\u00a0 Specifically, the following list of items are repeatedly flagged for audit by the IRS.\u00a0 Please take a close look at this list, which is by no means comprehensive, and always have your CPA or tax attorney help you prepare and file 1031 exchange paperwork and returns.<\/p>\n

<\/p>\n

\"1031<\/a><\/p>\n

1) Gain computation errors (i.e. taxable boot* due to debt; non-exchange expense items included<\/em><\/strong> in the computation)<\/p>\n

2) Invalid identifications (fail the three-property 200% to 95% tests; by not acquiring substantially the same property that was identified; or identifying a partial interest and acquiring a higher<\/em><\/strong> percentage interest)<\/p>\n

3) Wrongful inclusion<\/em><\/strong> of property improvements made after<\/em><\/strong> the exchange closed in the boot calculation<\/p>\n

4) Withdrawing cash out of proceeds from relinquished<\/em><\/strong> property (i.e. all cash needs to be used for purchase of exchange property)<\/p>\n

5) Partnership\/LLC Property Dispositions regarding foreclosures of real property and wrongful<\/em><\/strong> accounting of cancellation of debt (COD) income<\/p>\n

*Boot<\/strong> defined \u2013 cash or property of a type not included in the definition of a nontaxable exchange.\u00a0 The receipt of boot will cause an otherwise tax-free transfer to become taxable (Black\u2019s Law Dictionary)<\/p>\n

\"1031<\/a><\/p>\n

Exchanging income producing property into or upgrading into triple net (NNN) commercial property or other similar like-kind property is an incredibly profitable strategy which some of the wealthiest individuals, families, private companies, and corporations have as a basis of their generational wealth building strategy.\u00a0 These types of transfers are best left to professionals to facilitate and navigate the transactions and associated tax ramifications.<\/p>\n

Please contact me for specific questions about income-producing property strategies, tax strategy advice referrals, and any other questions regarding these issues and transactions.\u00a0 I\u2019m confident I can point you in the right direction and help identify an avenue for clarification or strategic involvement.<\/p>\n","protected":false},"excerpt":{"rendered":"

Selling, Exchanging and Facilitating a Tax Deferral Strategy Requiring the Use of a Qualified Intermediary and IRC 1031 Requires Careful Planning and a CPA or Tax Attorney Internal Revenue Code Section 1031 Like-Kind Exchange Audits continue to find non-compliance in some common areas.\u00a0 Specifically, the following list of items are repeatedly flagged for audit by…<\/p>\n","protected":false},"author":5,"featured_media":523,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[12],"tags":[59,68,60,61,65,67,64,63,62,66],"yoast_head":"\nMost Common Real Estate Tax Audit Issues In 2014 And How To Avoid Them - shellyrobersonrealtor.com<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/shellyrobersonrealtor.com\/most-common-real-estate-tax-audit-issues-in-2014-and-how-to-avoid-them\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Most Common Real Estate Tax Audit Issues In 2014 And How To Avoid Them - 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