US Legal Forms
North Carolina Tax Free Exchange Package

North Carolina Tax Free Exchange Package

Category:

Taxes - Tax Free Exchange

State:

North Carolina

Control #:

NC-P064-PKG

Format:

Instant download

Description

The Tax-Free Exchange Package contains essential forms to successfully complete a tax-free exchange of like-kind property.

This package contains the following forms:

(1) Exchange Agreement

(2) Exchange Addendum

(3) Certification Of No Info Reporting On Sale Of Exchange

(4) Like-Kind Exchanges

(5) Sale of Business Property

(6) Personal Planning Information and Document Inventory Worksheets

Detailed Information on each form:

1. Exchange Agreement - This form is used to establish the intent to enter into an exchange agreement and to otherwise qualify the contemplated transactions under the qualified intermediary safe harbor.

2. Exchange Addendum - In this form, the parties amend an existing contract to buy and sell real estate and agree that the Exchanging Party's rights under the contract are assignable prior to closing to structure an exchange of the property under Section 1031. The Cooperating Party agrees to reasonably cooperate in such exchange with the Exchanging Party.

3. Certification Of No Info Reporting On Sale Of Exchange - Complete this form to determine whether the sale or exchange should be reported to the seller, and to the Internal Revenue Service on Form 1099-S, Proceeds From Real Estate Transactions.

4. Like-Kind Exchanges - This form is used to report each exchange of business or investment property for property of a like kind to the Internal Revenue Service.

5. Sale of Business Property - This form is used to report gains, losses and recapture amounts from the sale of business property and involuntary conversions.

Deed of Gift of Real Property

Deed of Tax Indemnity

Tax Indemnity Agreement

Manufactured Home Transfer Disclosure Statement

Ownership Disclosure Statement

Transcript Order Form

Replacement Window Estimate

Developer-Oriented Distributor Agreement

Vendor Evaluation

Environmental Workform

Transcript Information Sheet

Correction Statement and Agreement

Application for Variance

Sample Letter for Bonus

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FAQ

When you exchange one North Carolina mountain property for another and defer the payment of state and federal capital gains tax, Section 1031 of the IRS code states that both properties have to be of like kind. This means that the properties must be held either for investment or for a productive use in a business or

Gain deferred in a like-kind exchange under IRC Section 1031 is tax-deferred, but it is not tax-free. The exchange can include like-kind property exclusively or it can include like-kind property along with cash, liabilities and property that are not like-kind.

Broadly stated, a 1031 exchange (also called a like-kind exchange or a Starker) is a swap of one business or investment asset for another. Although most swaps are taxable as sales, if you come within 1031, you'll either have no tax or limited tax due at the time of the exchange.

Your basis is equal to the amount you originally paid for the property, plus any improvements you made, minus depreciation deductions. For example, say you have a rental house located at 589 Santa Sophia Ave. You bought the property for $80,000 and paid a total of $40,000 for foundation and roof work.

To receive the full benefit of a 1031 exchange, your replacement property should be of equal or greater value. You must identify a replacement property for the assets sold within 45 days and then conclude the exchange within 180 days. There are three rules that can be applied to define identification.

A 1031 exchange gets its name from Section 1031 of the U.S. Internal Revenue Code, which allows you to avoid paying capital gains taxes when you sell an investment property and reinvest the proceeds from the sale within certain time limits in a property or properties of like kind and equal or greater value.

Trade up in real estate value with one or more replacement properties. Reinvest all of your 1031 exchange proceeds from the relinquished property into the replacement property.

Normally a 1031 exchange is used to defer the capital gains tax owed by reinvesting 100% of the proceeds from the sale of a relinquished property into the new replacement property.

Affidavit of Service - Intervention as a Matter of Right

Affidavit of Service - Intervention Motion

Report of Guardian Ad Litem

Certificate of Representation and Parties

Closing Statement

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