San Francisco Real Estate - Residential

Private Annuity Trusts may provide enormous financial benefits - Part 6

This article is part 5 of a series provided by our friends at Quantum Advisors.

- Mick Orton

If you own highly appreciated real estate, we know that you may be reluctant to sell because of the large tax bill you think you’ll face. This hesitancy may be especially true if you own investment real estate, because you may have to pay both capital gain taxes and depreciation recapture taxes associated with the sale. We know that the thought of selling real estate, and paying 20%, or even 30% of the sale price in taxes to the government has stopped many real estate investors from selling their properties.

We think there may be a solution you’d like to investigate: The Private Annuity Trust.

You may have heard that as of Wednesday the 18th of October, 2006, the US Treasury department announced changes planned for allowability of the PAT as we know it. The bottom line is that PAT's will still be available, but the Treasury Department wants to eliminate the tax deferral benefit. This means that we will not use the PAT structure for tax deferral any longer. That of course is the bad news. The good news is that we still have the following tax deferral options available for clients. Over the next few weeks we will discuss in detail options that these new changes bring.

1031TIC - 100% tax deferral and the client can own a percentage of an institutional grade investment property.

Custom TIC - 100% tax deferral and the client can own up to 100% of an institutional grade investment property.

Structured Installment Sale - This is the PAT replacement. 100% tax deferral with the payments guaranteed by a very large US insurance company.

We actually are confident that 4X more clients will opt for the Structured Installment Sale. We were already planning to bring the Structured Installment Sale out as an additional option for tax deferral. Anyone who is interested in tax deferral will be offered the above 3 options which should work for almost everyone.

We are in the process of re-creating our website, our marketing materials, our seminar presentations, etc. to offer a truly comprehensive platform of solutions for your clients – we are always here to provide solutions – whatever works best for the client – and we have multiple choices to offer that will help them solve the problem of selling their highly appreciated real estate without worries about losing a third to taxes.

For more information, or for a FREE, 10 page Tax Savings Analysis on your property, contact Gary Katz at QFN – 800-224-1053 – or email Gary@QAplan.com.

- Betsy Hartwell - Quantum Advisors

*This is the sixth in a series of articles - to be continued...

Part 1 may be read here.
Part 2 may be read here.
Part 3 may be read here.
Part 4 may be read here.
Part 5 may be read here.

posted by SFResidence.com @ 7:28 AM