New York 1031 Exchange Attorney Natalia Sishodia Discusses How to Defer Taxable Gain on Property

New York 1031 exchange attorney Natalia Sishodia releases a new blog post (https://sishodia.com/new-york-1031-exchange-attorney-explains-how-to-defer-taxable-gain-on-property/) discussing how to defer taxable gain on a property. The lawyer mentions that capital gains tax is the tax imposed on the profit from a sold property. Capital gains usually vary between 22 percent and 30 percent if the property is owned for over a year. The difference lies in whether the property is owned by an entity or by an individual.

“Talking to many Real Estate Professionals and in light of the new administration, there is concern that capital gain taxes will increase in the next couple of years. A well-structured 1031 exchange can resolve income tax problems by providing a tax deferral for taxpayers who want to sell their low-basis investment property, but do not want to pay federal and state income taxes,” says the New York 1031 exchange attorney.

The lawyer explains that a 1031 exchange has its own advantages. The main advantages a 1031 exchange gives is that the owner an increase in purchasing power, leverages, management relief, increase in cash flow, diversification, and many others. A 1031 exchange, otherwise known as a Deferred Exchange, is one of the most popular tax strategies available when it comes to real estate transactions.

Attorney Natalia Sishodia adds that a 1031 exchange allows the owner of a property to defer taxable gain on the transaction to a future date and therefore gives them more cash available for the purchase of a new property. The lawyer says that it is important to remember that a 1031 exchange defers tax but it does not make the property tax-free.

In the article, attorney Sishodia says that the rationale behind the tax deferral is that the taxpayer’s investment remains the same. Only the form has changed and it will be unfair to the taxpayer if they are forced to pay tax on a “paper gain”.

According to the real estate attorney, “A 1031 Exchange is a great strategy to defer taxable gain on the property but when setting up or completing a 1031 Exchange, taxpayers need to fully understand all the rules and procedures set forth in the tax code. Avoiding mistakes, knowing how to take advantage of IRS Code section 1031, and identifying if your property qualifies for 1031 and what type of deferred exchange works best for you is not easy to navigate.”

Lastly, the lawyer also stresses the importance of having an experienced lawyer when negotiating the purchase or sale of real estate, or in any other real estate transaction. An experienced lawyer can help clients understand their rights and ensure they get the best deal possible.

About Sishodia PLLC

Sishodia PLLC’s team of professional NYC real estate attorneys pride themselves on their ability to navigate complex investment laws and intricacies to offer the most comprehensive advice and guidance possible for their clients. The lawyers at Sishodia PLLC take time to fully understand each client’s unique goals and circumstances, minimizing potential risks and issues. Call them today at (833) 616-4646 for a consultation.

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