I have one house in brazil we are trading for one house in florida. 3 lawyers gave us the same answear, that we would have to make two separate transactions.
Problem is that neither party have 1 milion floating around to do the transaction, send the money overseas and do the other transaction (besides the fees tax and so on which would make the transaction less atractive). So we are thinking on just donating both properties and pay the donation tax. OR buy the houses for the smalled possible price (what I think, irs can say we are making fraud and get us donation tax anyway).
Today I tought on a third option – buying the conpany that holds the house here for the smallest possible price, instead of buying the property that the conpany holds. And do the same back there (we can set up any price back there and would not have any issue) So my question is – what would be the smallest value that I could buy a 1m house without giving red flag for fraud? And what would be the smallest value possible that I could buy the company that holds that house for (company makes 70k gross of rental on that property)
Swapping properties in different counties
byu/4nd4r1lh0 inrealestateinvesting
Posted by 4nd4r1lh0
1 Comment
Howdy.
Although paragraphs would help I also suspect that English may not be your native language which is making understanding what you are attempting to do difficult.
First – Don’t get cute with taxes. A million is a lot of money but also not a lot of money and not worth the risk of being “cute” in an attempt to make a deal.
In the US a Deed for Deed Exchange, while infrequent since the Starker 1031 ruling came about, absolutely allows for a property for property exchange if the properties meet 1031 qualifications. Even non-investment properties can still be traded in the US.
The attorneys who are telling you that the properties cannot be traded what type of attorneys are they? If it is due to some Federal legal reason it would make sense as to why you cannot. I might contact a good Title Company, in particular one that has experience with foreign transactions, and see if they have any ideas.
An interesting thought might be if each owner can sell to each other with an Installment Sale (Seller Financing) and the payments match or meet however they need to in order to make this work and are in escrow/serviced by a 3rd party.