to do a 1031 you have to buy the next property and have the same loan amount on it as your old one. "like kind" or upgrade. so if i do a 1031, and my relinquished property had a 400,000 loan on it, I will always have to keep a 400,000 loan or higher on the next proerties. so my monthly payments will ALWAYS be the same, no matter how many times i do a 1031.
or is it...i have a 400,000 loan, in 5 years i pay it down to 300,000, and when im selling it its at 300,000 i have to have a 300,000 loan on the next property, then hold it and pay it down to 100,000 for example, then the next house i exchnage has to have a 100,000 loan amount? or is it based on the loan amount i took out at the time i bought it on my first one?
is it possible to build equity to where i have no loan on a propertyu with a 1031, or is a 1031 only for upgrading properties (keeping the same amount of loan on it, so my paymetns will be the same) but because its upgrading, it can produce more cashflow?
2007-07-22
18:47:32
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5 answers
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asked by
beach_babe971
2
in
Business & Finance
➔ Taxes
➔ United States
maybe a 1031 isnt for me? i have 5 properties. i want to buy and hold for 7-10 years then keep all the campital gains. and never buy anouther property again. so why would i need a 1031?
2007-07-22
18:53:55 ·
update #1