Selling Rental Property & NOL

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Selling rental property and NOL always requires you to keep a few key things in mind. Learn about selling rental property and NOL with help from a managing broker with Windermere Real Estate in this free video clip.

Part of the Video Series: Real Estate Questions
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Video Transcript

Hello, Jim Jacobsen with Windermere Real Estate here in Seattle, Washington. I am a managing broker in Seattle and the question comes up about selling of investment property and the biggest thing about investment property is that there are some huge tax consequences or benefits when you own rental property. This then goes directly to questions that are resolved by your CPA or your tax preparer and I send my clients out to get that done prior to us sitting down so they have a good idea of what we're really looking at for the future. I also talk to my clients a lot about 1031 exchanges and that's another aspect or real estate which is a deferment of those capital gain taxes you normally pay when you sell a piece of rental property. So again, go to your tax preparer or your CPA, get your questions answered and then after that it's no different than any other sale. It's a sale and the numbers come into play for tax reasons but again we might be looking at 1031 exchanges which a lot of my clients do. In a 1031 exchange, basically in simplified words, is that the seller does not have any contact with the monies that are being raised from the sale and it's given to a third party fiduciary that actually is going to purchase the property in their name and transfer the property to the buyer. So if I'm going to do a 1031 exchange, I'm probably going to go to a lawyer and have them take care of all the exchange for me and then I have to nominate and close the property within the guidelines of IRS to defer that tax to a future time on an original basis of the first property that is started for the tax deferment.

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