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Hollander and Company LLC
5 Penn Plaza
19th Floor
New York, NY 10001
Telephone: (212) 576-1061
Facsimile: (212) 576-1078
Email: info@hollanderco.com
Directions to our Office.

 

 

1031 QUALIFIED INTERMEDIARY SERVICES

In 1997, Congress passed new, generous rules that effectively eliminate capital gains tax on the sale of most people's primary residence. But what happens if you are selling any other classification of real estate investment property, business property, vacation home, etc.? You will be taxed on your profit unless you use the IRS Section 1031 Exchange Rule.

Despite recent reductions in capital gains tax rates, why pay taxes on the sale of investment real estate when you can defer that tax and increase your buying power on a bigger and better property?

Through the use of a “1031 Exchange”, Hollander and Company LLC can assist in putting off taxes you would otherwise pay on the sale of investment property.

In conjunction with the Attorneys Exchange Alliance, serves as Qualified Intermediaries, in order to help firm clients defer tax upon the sale of investment real estate.

For further information on this service, contact Jay Hollander, Esq. at jh@hollanderco.com.


NOT SURE WHAT 1031 EXCHANGES ARE ALL ABOUT?

Read our 1031 FAQ below.

WHAT IS AN EXCHANGE?
Use of the word "Exchange" is essentially a "legal fiction". What happens in the real world is that a sale and subsequent purchase are made interdependent using the Exchange technique and special paperwork. (You sell to whomever wants to buy and then buy whatever you want from any Seller.) These "exchanges" are often called Starker Exchanges or Tax Deferred Exchanges, but a better name would be The Investment Roll Over Rule. Your money rolls over into a new purchase.

WHEN SHOULD YOU USE THE TECHNIQUE?
Anytime you are selling real estate that is not your primary residence and you are faced with an onerous capital gains tax, use the Exchange technique instead of simply selling. Virtually any new purchase will qualify as your replacement property. The diagram below will give you the idea.

WHY SHOULD YOU DO AN EXCHANGE?
Tax money paid to the government is immediately lost forever and forever is a long, long time ! When you purchased the property, did it occur to you that you had made the Government a silent partner who would want to share the profits? Think of how long it would take you to save money lost to taxes and to rebuild that hard earned equity. Fortunately, you con avoid this scenario using the Exchange Technique.

HOW DO YOU DO AN EXCHANGE?
Your sale and subsequent purchase must take place within a 180 day envelope. Special paperwork links these two events together and allows them to qualify as an Exchange. Sale proceeds must be deposited in a special account during the period between the sale and purchase. Exchange Rules require that you designate a Qualified Intermediary to perform these services. Follow the explanation below to see how it works:

1. The Exchangor enters into a Contract to sell to anyone who wants to buy.

2. The Exchangor enters into an Exchange Agreement with a Qualified Intermediary.

3. The Contract for Sale between the Exchangor and the Buyer is assigned to the Qualified Intermediary.

4. The Closing takes place, the Exchangor deeds the property directly to the Buyer and the sale proceeds are deposited with the Qualified Intermediary.

5. Within 45 days after Closing, Exchangor identifies possible replacement property to the Qualified Intermediary.

6. The Exchangor enters into a Contract to purchase whatever property is desired from the Seller of that property.

7. The Contract for Sale between the Exchangor and the Seller is assigned to the Qualified Intermediary.

8. The Closing takes place within 180 days of the first closing, Seller deeds directly to the Exchangor, and the monies held by the Qualified Intermediary pay for the purchase.

9. The Exchange has been completed and no tax is owed. What really occurred is a Sale and subsequent purchase that were made interdependent through use of the Exchange technique and use of a Qualified Intermediary.

ARE THERE ANY RULES OR REQUIREMENTS?
There are three requirements your transactions must meet in order to have a completely non-taxable event.

The Exchange Technique is not “all or nothing”. It is possible to get some cash ( which will be taxable) provided it is done the right way. The Exchange technique can be flexible to meet certain needs.

A SUMMARY OF EXCHANGE BENEFITS

1. You will save significant money you worked hard to earn. Tax money is lost forever. The Exchange Technique makes this loss unnecessary.

2. It is true that you must purchase something new to avoid the tax BUT the Government helps subsidize your new purchase with your tax savings and, therefore, your purchasing power is significantly increased.

Let Hollander and Company LLC help you increase your investment property buying power!

For further information on this service, contact Jay Hollander, Esq. at jh@hollanderco.com.

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Learn more about our law practice and services in our About Us section.

We have been very fortunate to be represented by Hollander and Company LLC when it came time to trademark our company name. Their attention to detail was useful to us in helping clarify exactly what it was we were doing and what to expect. Also Jay Hollander was always sure to keep us up to date on what was happening. In this day when you hear horror stories about attorneys never following up it's good to know you've got someone on your team that you can trust.
Dan Cashman


Mr. Hollander consistently worked with my interests in mind, and often juggled his calendar around to accommodate meetings. He checks his email, voicemail, and responds during hours when most attorneys wouldn’t.
Jerry Revich

I would like to thank you personally for the excellnt Lan Management contract review, which you recently completed for us. It brought to light many issues that might have gone unnoticed if we had taken the path we pursued on a prior software management agreement. In today's Software and Services market it is imperative that the right Legal firm with the right experience review your contract before you sign on the dotted line. In closing I would like to say I really appreciated your efforts and attention to detail.
Michael A. Ritholz - Data Processing Manager - Borah, Goldstein, Altschuler, Schwartz & Nahins, P.C.

Your thoroughness and diligence in preparing for the closing made it a breeze for me. In addition, your kindness, respectful nature and sense of humor made it all enjoyable.
Laurie J. Harrison

Thank you so much for taking on my co-op purchase. As a first time buyer, there was no limit to how much about the process I did not understand. The patient guidance afforded to me by Hollander and Company LLC helped enormously. I am sincerely grateful for your diligence and smarts applied on my behalf. I will be more than happy to recommend your services to anyone looking for assistance in this area.
Andrew Maskin


I wanted to thank you and your firm for handling the sale of my property... I don't think the sale would have gone through without you and your firm's help.
Lisa Conway, Sales Agent, Halstead Property Company

The quality of your work and your personal and professional dedication really do make a difference.
David J. Pitkoff - CFO - Jason Maxwell, Ltd.

You provided great communication every step of the way to be sure that we were aware of what was going on.
Scott A. Anderson - IT Director -Hollander Home Fashions Corporation.

Your insight and expertise were invaluable in putting together the appropriate contracts and negotiating the optimum financing for our company.
Carl Bachmann - President - Veterans First Financial Services, Inc.

I knew nothing about Internet law, but after our first meeting I felt at ease as Jay explained it in a manner that any person could understand.
Gregory Edson - President - Cityopoly Inc.

The unique insight that you have been able to provide into the world of internet law has enabled us to position ourselves at the leading edge of the email follow-up and marketing industries.
Tracy R. Byrne - Vice Presidetlt, CMO - Electrisoft Corporation

Jay Hollander was great about explaining exactly what needed to be done in setting up our corporate structure and shareholder agreement, as well as how to craft contract language that would protect our interests in the future.
Nicolas Richards - President & CEO - MedAbiliti Software Inc.

Jay provides us with full legal services. He has represented us in complex bankruptcy issues, commercial office and store leasing and litigation.
David Ritter - Kensington House Company