Biden Tax Proposal! 1031 Exchange Explained

In today's video, we're going to talk about one of Biden's tax proposals and how that's going to affect your investment. Coming up next. Understanding new policy proposals and their potential impact on your business will help you make the best decision when it comes to asset protection and real estate planning. The new Biden administration brings a wave of new policy shifts. that will impact property owners, landowners, and investors. Before we begin, make sure that you subscribe. I'm working hard on this channel to bring you over 40 years of real estate experience. I've been a broker, mentor, and investor. I want to help the new and experienced investors, those who want to create the life they've always wanted through real estate. Let's jump on in. The 1031 provision allows investors to defer their capital gains on investments when selling the investment property and transferring those proceeds to the next property that you buy. It's actually named after the IRS tax code 1031. This is a much-loved tax break for real estate investors and creating wealth. The exchange can only be accomplished by purchasing similar properties. And the rules of the IRS limit this provision with vacation properties. The law also comes with timeframes that can make it challenging. Biden's new policy proposal will abolish 1031 for properties that are over $500,000. So if you've got a property that's appreciated in value up to $510,000, It goes away. You are going to have to pay the taxes on that property when you sell it. Okay, so what does that mean for investors? Okay, that means that again, if I have a property that's $500,000 or below, I can still continue to defer those gains on that property. But for an investor that has a property that's worth $500,000 or more, That goes away, which means that the government wants their money, their portion of the capital gains. They want it right away instead of waiting years down the road. A 1031 exchange can be used by savvy real estate investors as a tax-deferred strategy to build wealth. The many complex moving parts not only require understanding the rules, but also enlisting professional help. Even seasoned investors. So make sure you reach out to a tax professional. If you want to learn more about real estate investing, click on this video right here. I do a full walkthrough of one of our latest flips and break down what to add to make the most on your next flip. Reach out anytime. I'm here to help.