1031 Exchanges Austin TX

This article discusses the benefits of 1031 exchanges and explains how they can be used to better leverage real estate in an investor's portfolio.

Local Companies

Texas Commercial Partners
512-934-3322
1921 Lohmans Crossing
Lakeway, TX
Dunnam Samuel E
(512) 476-4005
2600 Lake Austin Blvd Apt 6106
Austin, TX
Austin Financial Partners
(512) 342-0202
8911 N Capital of Texas Hwy
Austin, TX
Capital Cities Asset Management
(512) 219-7566
11651 Jollyville Rd
Austin, TX
Wilson Walter L III Rep
(512) 458-2517
4005 Guadalupe St
Austin, TX
Alpha Capital Management
(512) 329-0404
1501 S Mo Pac Expy
Austin, TX
Austin-Houton Investors
(512) 346-2076
8733 Shoal Creek Blvd
Austin, TX
Poore Megan Rep
(512) 458-2517
4005 Guadalupe St
Austin, TX
Harrison Securities Inc
(512) 478-2184
1607 Forest Trl
Austin, TX
Investor's Advantage
(512) 794-1188
4131 Spicewood Springs Rd
Austin, TX

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1031 exchanges remain one of the most powerful investment tools, yet they are also one of the most misunderstood and under-used. 1031s were created by the government to help investors increase their returns through continual investing. Investors need to understand how to leverage their portfolio using 1031 exchanges to best maximize future growth.
To put it in perspective, one can imagine 1031s as free capital with:

  • 0% interest: The investor pays no interest on the money the government gives them.
  • High LTV: The capital can be leveraged at the investor’s highest LTV capability. 
  • No Due Date: Investor keeps the money as long as it is invested in real estate. 
  • 85% Free Profits: The investor keeps 85% of what the government's (leveraged) money makes them—these are free profits from an outside money source.
  • Potential Non Re-Payment: With proper long-term investment practices and proper financial planning, the investor may be able to avoid fully paying back the government’s money (this may also include not having to pay back any depreciation recapture).

Tax free compounding growth through 1031 exchangesCommon misconceptions

The most common misconception with 1031 Exchanges is that they save you money. The thought process goes something like this: “If I do a 1031, I don’t have to pay the government their taxes this year; thus I saved a little bit of money.” However, there are two major problems with this line of thinking. First, 1031s by design only defer an investor’s tax obligation, thus the investor still owes the money and has not saved a penny. Second, this thought process requires the investor to look backwards at the property sold as a profit source—not forward at the properties to be purchased—and looking backwards inevitably decreases potential returns.

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NuWire Investor is an online publication that offers quality information about alternative investments such as real estate, commodities and franchises.

Author: Ken Zimmerman
Copyright © NuWire Investor and NuWire, Inc 2007. All rights reserved. NuWire Investor material may not be copied, reproduced, redistributed, published or modified without the prior express written consent of NuWire, Inc.

Featured Local Company

Texas Commercial Partners

512-934-3322
1921 Lohmans Crossing
Lakeway, TX

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