Flashcards in Ethics, Investment Properties, Income Tax, Trust Accounts, Environmental Issues Deck (17)
Origination Fees. \
(-) Adjusted Basis
Capital Gains (taxable gains)
1031 tax-deferred exchange (like-kind exchange)
Used by investors to defer payments of capital gains taxes.
Allows to sell one property and buy a new one without paying cap gains.
⚡️The intent is to defer payment until owner is in a lower tax bracket.⚡️
⭐️Real Estate Professionals are expected to fully disclose what?⭐️
1- Whom they represent in the transaction.
2- The obligations of all parties in regard to disclosure of material defects.
3- Whether they are a principal in the transaction.
4- Whether there may be any environmental, material, or other issues requiring disclosure that might impact the property.
Mkt value (-) current debt
When must you pay capital gains taxes?
Short-term gain: on property held 12 months or less, taxes at ratepayer's ordinary income tax rate.
Long-term gain: on property held more than 12 months
The gain from the sale of a primary residence is excluded from full tax how?
1- $250,000 maximum if single or if married filing separately.
2- $500,000 maximum if married filing jointly.
The taxpayer must own & occupy the residence for @ least 2 of the last 5 years before the sale.
Value of improvements ➗ number of years being depreciated ✖️number of years already taken.
Using trust funds for personal reasons or for other people is called ___________ and is illegal!
Brokers must __________________ of all money deposited in and disbursed from the trust account.
Keep accurate records.
Environmental issues are considered ____________ that must be disclosed by the ⚡️seller⚡️and the ⚡️brokers⚡️
⭐️includes issues outside of the property boundaries ⭐️
A broker who suspects that an environmental issue may affect the property, must ___________ , even if the sellers believes it has been ______________.
Cured or removed.
If a building is being demolished or renovated, _____________ (_________) should be done by a licensed professional before demolition.
(Sealing in place) is often a better choice than removal because there no danger of exposing the fibers.
Naturally occurring odorless, radioactive gas.
Can cause lung cancer.
Impossible to detect without testing.
Typically mitigated by adding a ventilation or exhaust system to move the gas outside.
⭐️Levels must be under 4.0 picocuries⭐️