Here are expenses that are often encountered at closing, and included on the "HUD-1" Settlement Statement, which generally are considered by experts to be included as part of the 1031 Exchange calculation:
RELINQUISHED PROPERTY
Escrow for Repairs
Commission
Loan Fees
Title Charges
Recording Fees
Additional Charges
Termite
Courier Fees
Exchange Fees
REPLACEMENT PROPERTY
Title Charges
Title Insurance
Recording Fees
Additional Charges
Exchange Fees
Termite
Courier Fees
Survey
EXCLUSIONS: Expenses relating to debt relief, taxes, insurance, prepaids, interested, association fees, etc., while a part of the settlement transaction, are generally NOT included in the 1031 Exchange calculation.
As with all information of this type, you need to consult competent 1031 Exchange tax professionals for specific guidance relating to your particular needs.
Visit my web site for 1031 Exchange and additional resources and services: http://www.LawrenceYerkes.com/
and visit BestHomes-NJ.com for the latest New Jersey Real Estate property listings (residential, commercial, multi-family, farm, land)
Copyright 2006 by Timon, Inc. All Rights Reserved.
1031 Exchange Expense Inclusions
3 comments • Lawrence Yerkes - Broker Associate, Southern New Jersey Real Estate Services • August 23 2006 10:44PMComments
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Great Site Larry- give me a buzz to discuss 703.801.4178.
James Brennan, Esq.
www.realestatetax.blogspot.com
I'm just launching a new 1031 calculator and I'd love to get your feedback on it.
It's at www.1031summary.com
Let me know what we could do to improve on it. Constructive comments would be appreciated. I'm also considering the possibility of co-branding it, so let me know if that would be interesting to you.
Also, for 1031 advice, the best 1031 attorney I've met is a guy named James Brennan. He's the 1031 expert from Wachovia. You can find his ActiveRain profile here and he's great at answering questions. His website is www.Inside1031.com
Regards,
DROdio
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Lawrence,
Great post. Most professionals are not aware of the various permissible and non-permissible expenses in terms of 1031 exchange transactions. Kudos!