1031 Exchanges | Application

I C: Tax strategizing has really opened my eyes. There's a stat out there, I'm gonna butcher it, but it's something to the tune of over 90 % of the wealthiest families focus on tax planning in itself. I've said this in a previous episode, but if you pay taxes, that's money that you will never see again. If instead you can keep that money in your pocket, you can continue having that work for you. And then the power of compounding can do its thing. So if you can avoid paying a capital gains tax, that is light years beyond beneficial. In terms of different 1031 strategies, if you have a home that you want to sell, you can 1031 into another home or another piece of real estate and continue to manage things yourself. Or there actually are opportunities where you can do this in a passive way as well. So you can 1031 into a private equity play. And that way you don't have to be the one dealing with the tenants, the toilets and the trash again and again. Who it's for is for someone who is ready to let go of that day-to-day management. You need to make sure that you like the strategy. Is it in an office building? Is it in a multifamily strategy? How does the end look like? Am I 10-30 wanting and 10-30 wanting over and over again, which... by the way, can eat into your returns because you're probably going to pay fees on fees on fees. How is it liquid? Am I going to have to sell my entire property in order to get some money out or can I take a portion of it out? Also, are you, do you qualify for a 1031? Because if you're in a partnership, usually that means that you cannot 1031 unless every single person in that partnership agrees to the, to a 1031. Otherwise, you do have different strategies at your disposal, which is called a drop and swap. So you can reorganize the LLC or into a TIC or other mechanisms that are similar. So there are typically solutions. It might take a little bit longer, but sometimes it is worth that extra energy. Aside from 1031s, there are Opportunity Zone investments. So that allows you to invest capital gains beyond just real estate. So if you sell a business art crypto stocks, you can actually defer paying taxes on those capital gains. again, a dollar today is worth more than a dollar tomorrow. And so being able to invest that can be truly meaningful for your wealth. I've also mentioned that there's a difference between a CPA and a tax planner. So There's a lot of different comparisons that we've talked about over the different episodes, but if you have a doctor, that doesn't necessarily mean that a foot doctor will be able to tell you the same thing as your general practitioner. So in the same way, a CPA is, is good at their domain, but that doesn't necessarily mean that they are a tax planner. So a lot of wealthy families will have a CPA and they will also have a tax planner. There are two separate people and. I am a big proponent for planning, so I'm not going to bore you with that story anymore. But every situation is unique. 1031s can be very intricate, so consult with someone, but definitely reach out to me or to Mike for any sort of advice that you'd want in this realm. I really hope it helps because the wealthiest do focus on tax planning. Until next time, adios.