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Does the QI actually take title to the properties?
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No. Our company will always direct deed between
buyers and sellers.
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How are my funds held by the QI?
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Client funds are deposited directly from the closing agent to a
segregated FDIC insured escrow account at Matrix Capital Bank.
Client funds are never commingled. Funds cannot move from the
account without written instructions from the client. Clients
can view account balances online at any time while held in
escrow by our company.
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What are the steps to follow in a
typical 1031 delayed exchange?
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Please refer to our company brochure on this web site for a list
of typical exchange steps.
During a tax deferred exchange the exchanger is not permitted
actual or constructive receipt of money or property. You are in
actual receipt when you receive or can obtain economic benefit
from the money or property. You are in constructive receipt when
money or property is set aside for you or made available to you
to drawn upon. You are not in constructive receipt if your
access to the funds or property is restricted. The use of a
qualified intermediary and written agreements limiting access to
funds during the exchange period provides a safe harbor for the
funds or property thereby avoiding actual or constructive
receipt.
Boot is any property received by the taxpayer in the exchange
which is not like-kind to the relinquished property. Boot is
characterized as either "cash" boot or "mortgage" boot. Realized
Gain is recognized to the extent of net boot received.
Mortgage Boot consists of liabilities assumed or given up by the
taxpayer. The taxpayer pays mortgage boot when he assumes or
places debt on the replacement property. The taxpayer receives
mortgage boot when he is relieved of debt on the replacement
property. If the taxpayer does not acquire debt that is equal to
or greater than the debt that was paid off, they are considered
to be relieved of debt. The debt relief portion is taxable,
unless offset when netted against other boot in the transaction.
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