Investors who own highly appreciated rental properties are finding tax advantages by selling now, and reinvesting in Class A and Class B commercial and multi-family complexes, office buildings and retail malls.

By trading up, or exchanging from one like-kind property investment to one of equal or greater value, the IRS allows investors to utilize an IRC §1031 which defers capital gains.

A popular choice among real estate investors seeking replacement property for their §1031 tax deferred exchange is Tenant-in-Common Ownership (TIC), also known as fractional ownership. Under this co-ownership structure, you will own an undivided fractional interest in an entire property and share in your portion of the net income, tax shelters, and growth. Further, you will receive a separate deed and title insurance for your percentage interest in the property and have the same rights as a single owner.

Because TIC opportunities are often "packaged" with management and financing in place, TICs offer superior efficiencies in the identification, acquisition, financing, closing, and operating stages of real estate ownership.

There are regulations that must be adhered to such as identifying up to three qualified substitutes within 45 days and closing on one of those properties within 180 days. Investors are looking toward seasoned professionals to assist them to find a qualified intermediary, replacement properties, and hit the benchmarks of this definitive time period.

The TIC Basics website is for public information only and is geared to educate those interested in a Tenant-in-Common real estate investment. For more information, please do not hesitate to contact us for personal one-on-one communications.

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