Trade and Exchange

COLORADO REAL ESTATE TAX DEFERRED EXCHANGE

1-800-887-7888 or (303)237-4025 Denver Metro area (303)431-0225 FAX

Help in locating Real Estate brokers specializing in locating 1031 "exchange properties" throughout Colorado, allowing investor clients to defer capital gains tax.

As a leader in the 1031 tax exchange industry Colorado Realty Hotline looks forward to helping clients find knowledgeable and professional exchange services.

The term "Relinquished Property" means the property you own which qualifies for tax deferral under Internal Revenue Code 1031 which you intend to exchange with a replacement property. The term "Replacement Property" means the property which qualifies for 1031 treatment which you intend to acquire in completion of the exchange. A 1031 exchange can only be used for an investment property, not a primary residence.

10 Simple Steps to a 1031 Tax Deferred Exchange

1. Discuss with your tax advisor intentions and objective of the exchange and discuss the
guidelines of IRS Code Section 1031. Contact Colorado Realty Hotline for a list of exchange properties in Colorado and a list of Realtors in your area qualified in the 1031 exchange, (remember it doesn't matter which State the exchange starts or where it ends).

2. Show "exchange intent language" in Sale Contract and notify buyer that rights under the contract will be assigned to an exchange intermediary, (Colorado Realty Hotline will provide you with the name of a qualified intermediary in your area). Not all intermediaries are alike in services, reputation and reliability. Fee quotes do not tell enough about the intermediary. The fee for an intermediary can range from $400-$1,000.

3. Enlist the services of the qualified intermediary prior to close of escrow of "Relinquished Property" to avoid constructive receipt of the proceeds. Colorado Realty Hotline will help you.

4. Colorado Realty Hotline will make you familiar with the identification rules and regulations set by the IRS to identify the "Replacement Property(ies)".

5. Properly identify the "Replacement Property" within 45 days after close of the "Relinquished_Property". Colorado Realty Hotline will refer you to a Real Estate Tax Deferred Exchange Broker that is a full time real estate expert that can supply you with a list of properties throughout Colorado, or a list of 1031 exchange properties in any State you choose to locate your "Replacement Property".

6. After a Colorado Real Estate Tax Deferred Exchange Broker has helped you identify the "Replacement Property", you enter into contract on "Replacement Property" and indicate exchange intent language in contract and that rights under contract will be assigned to the exchange intermediary. Contract must allow for closing no later than 180 days from close of"Relinquished Property".

7. Open escrow for "Replacement Property(ies)". Notify escrow officer of the intent to acquire the property under the provisions of a 1031 tax deferred exchange and the name of the intermediary. Colorado Realty Hotline will refer you to a qualified escrow company.

8. Notify intermediary which "Replacement Property(ies)" among the identified properties were chosen to be acquired and if any earnest money deposits are required. A Colorado Real Estate Tax Deferred Exchange Broker will help you prepare a promissory note if necessary.

9. Close the "Replacement Property" escrow no later than 180 days from the close of escrow of the "Relinquished Property". In Colorado, a Colorado Real Estate Tax Deferred Exchange Broker will handle all closing transactions with the escrow company for you.

10. A Colorado Real Estate Tax Deferred Exchange Broker will review with you any and all documentation for the transactions thoroughly prior to signing. Provide accountant with the final closing statements from the "Relinquished and Replacement Properties" for preparation of the appropriate forms to report the exchange on tax return. You have successfully deferred capital gains on an investment transaction!

Brief Review of Steps to a Successful 1031 Tax Deferred Exchange


1. Trade for like-kind property.

2. Trade equal or up in equity and debt.

3. Identify "Replacement Property" within 45 days from close of escrow of "Relinquished
Property" pursuant to the following requirements:

a) Limit identified properties to 3 or less or,
b) Identify 4 or more properties and acquire at least 95% of their total values or limit
their aggregate values to no more than 200% of the total value of the "Relinquished
Property".

4. Acquire "Replacement Property" within 180 days of close of escrow of "Relinquished
Property" or the tax return filing date, whichever comes first.

AND ABOVE ALL ELSE

5. Call Colorado Realty Hotline for a Real Estate Tax Deferred Exchange Broker that will offer experienced and qualified assistance, 1-800-887-7888. (Discounts on sales commission for all exchange clients when listing property in Colorado).

Contact experienced professionals today with your exchange questions. Let us show you
how simple saving money can be!

ASSISTING INVESTORS COAST TO COAST!

Colorado Realty Hotline

1-800-887-7888

For more information on 1031 exchanges:

info@coloradorealtyhotline.com