Live a relaxed and secured life through tenents in common.
by Lisa taylor Tax consultant‘Tenancy in
common (TIC)’ is a special type of agreement under which two or more investors
own a single property. TIC provides undivided ownership of property to its
investors. It is an arrangement that allows the investor to invest in the
property even if he/ she has small amount of money.
If we talk
about 1031 TIC Investment, it is an arrangement that allows the investor to
invest in the property even if he/ she has small amount of money. Here the
ownership shares are not required to be equal, and the ownership can be
inherited. This type of investment can be made for the projects like apartment
houses, shopping complexes, office buildings, etc. TIC is almost similar to DST
but one of the common differences is that TIC has the number of investors limited
to 35 whereas DST doesn’t have any limitation.
Every
Co-owner of the property receives an individual deed at closing for his or her
undivided percentage interest in the entire property. In brief, a TIC owner has
the same rights and benefits as a single owner of the property. So, in this
kind of arrangement the first and most important step is the involvement of
real estate companies. These real estate companies play a very important role
in closing the exchange. There are many real estate firms that can help you in
obtaining shares in TIC properties.
TIC
investment is very popular among investors, especially among1031 exchangers,
because of the flexibility in its structure, ease in purchasing TIC
properties, and low investment opportunities for those who are looking for
diversification.
The benefits
of ‘Tenancy in common’ investment aren’t limited to this only. Upon exchanging
a TIC property for another, investors can defer capital gains taxes on the
exchange. Before proceeding for exchange the real estate investors must be aware
of what 1031 exchange is? It’s an exchange that allows investors to reinvest
the proceeds of the relinquished property on the replacement
property. One of the important points that investors must keep in mind is
that properties involved in 1031 exchange must be held for productive use in
trade or business or for investment purposes. 1031 exchange had made possible
for the real estate investors to enjoy the benefit of tax deferment.
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Created on Feb 22nd 2019 02:36. Viewed 691 times.