Real Estate, as any investment, must be periodically reviewed to assure that it is consistent with your financial goals. As your goals and needs change, each investment should be evaluated to determine if it is appropriate to your financial goals. If not, how can it be converted to a more appropriate investment and at what cost can the conversion be made?

Why Exchange?

Tax-deferred exchanges eliminate one of the major constraints to reallocating funds between investments by eliminating the immediate need to pay capital gains tax normally due on the sale of any investment. Stocks, bonds, notes and certificates all require immediate payment of taxes. Only a few investments allow you to reposition your assets without immediately paying taxes on the gains. Common reasons to exchange are:

• Exchange non-income producing land for cash flow.
• Exchange properties to improve potential appreciation.
• Exchange properties to improve locations for convenience or quality of neighborhood.
• Exchange properties to avoid problem tenants.
• Exchange properties to avoid expensive maintenance and repairs.
• Exchange properties, with proper estate planning, for you and your heirs to avoid paying income taxes on the capital gains.

What Can I Exchange?

Any real property which is being held for investment or for use in a business or trade is eligible for deferral of the tax normally paid on the gain if like kind property is obtained to replace it.

How Do I Get Started?

Contact Wendy Wardlow to receive a free guide on 1031 Tax-deferred Exchanges, and to discuss your tax exchange questions. You may also visit the following 1031 Tax-deferred Exchange website: www.1031ECI.com