Going With A Qualified Intermediary For A 1031 Exchange

By Eric T. Rightley

The 1031 Exchange process starts with your CPA or accountant. The discussion should include the amount of taxes owed if you sold the property outright. The adjusted basis would be determined, and based on this adjusted basis, you can determine what the "normal" capital gains tax liability would be. Also, you can determine the amount of taxes that would be due to depreciation recapture. This depreciation recapture is currently taxed at a maximum rate of 25%. The capital gains that are attributed to depreciation are taxed at a higher rate.

Normal appreciation can be determined by your CPA or accountant from the natural increase in the value of your property. Normal appreciation is currently taxed at a maximum rate of only 15%. If you are in a state with an income tax or state capital gains tax, your CPA might also determine the amount of state and municipal tax liability.

Once you know what the taxes would be, if you decided to just sell the property outright, you can decide if you want to try to defer those taxes with a 1031 Exchange. Knowledge is power - typically, the costs of doing a 1031 exchange is far less than the tax bill, if you just sold the property outright.

Once the potential taxes are determined, a Qualified Intermediary should be brought in to help you complete a 1031 Exchange. Also, you need a written purchase agreement signed by both you as the seller and your purchaser stipulating your desire to sell your relinquished as part of a 1031 Exchange.

The purchase agreement should also include a stipulation or clause stating that you want to complete a 1031 Exchange. In this clause, it acknowledges that the purchaser agrees to cooperate in the exchange. You have now laid the groundwork for the closing. For sample cooperation clause go to www.1031podcast.com.

At this point, your closing can now take place, and your sale will be completed. Once the sale is complete, and the net sales proceeds have been paid directly to your Qualified Intermediary, your 10131 countdown will begin. The day after the closing is considered "day one." From this day, you have forty-five days to identify in writing the properties you want to purchase as your replacement property. It is also the first day of the 180 day exchange period that you have to complete the 1031 exchange and acquire your replacement property.

Now, I will review the steps you need to make in order to complete a 1031 Exchange transaction. The first step is to determine the capital gains tax bill, including depreciation recapture and state and local taxes. This step would be performed by your CPA or accountant. The next step is to determine if the 1031 Exchange process would be of benefit to you. This step would be made by your CPA or accountant with the help of a 1031 Exchange Qualified Intermediary. In step three, you should document your intent to sell the property to the purchaser, as well as your desire to complete a 1031 Exchange by inserting appropriate text in your purchase agreement.

If you do all of the above, you will start the process of deferring taxes and keeping your money working for you. - 23222

About the Author:

U.S. investors can save big money by utilizing a 1031 exchange to defer all of their capital gains tax on the sale of investment property. A 1031 tax exchange is like an interest free loan from the IRS.

A Guide to Buying Mutual Funds in the Philippines

By Jeffrey Mute

Mutual funds have become a popular investment vehicle in the Philippines in the past years. The main reason for its popularity is the fact that it has more advantages over other investment options. If you are planning to invest in mutual funds, a basic rundown is given below to guide you with this particular investment option. .

In laymans explanation, mutual funds can be understood as a fund which has an asset base jointly put up by different shareholders which is then invested into several diverse investment vehicles. A fund manager is designated to do all the decision-making regarding the kind of investments the fund will be put into. Invariably, he sees to it that the funds investments will gain maximum returns for the shareholders.

Mutual funds earn income in two ways. One is when the value of security assets increase which is commonly termed as capital gains. The other one is through the interests and dividends earned from the other investments of the fund. Upon earning income, it will then be divided among the shareholders according to the number of shares owned.

There are two ways a mutual fund can generate income. The first way is through the dividends and interests accrued from the funds investments. The second way is through capital gains, which occurs when value of security investments increase. Once gains are earned, it will then be passed on through the shareholders by distributing it according to the amount of ownership.

Yet mutual funds also have a negative side. The presence of a fund manager can be good, but it also means that you wont be able to take part in the decision-making process. With whatever investment the fund manager chooses to put the funds money in, the only thing you can do is hope that it will yield positive returns for the company. Also, be aware that certain mutual fund companies charge fees. You should take this into consideration as it can affect your investment in the long-term.

In contrast, mutual funds also have its disadvantages. One of which is that you wont be part of the decision making process with regards to how your money will be invested. Since a fund manager is the one who makes this decision, you can just hope he chooses the right investments for the mutual fund company. The worst that can happen is that your investment will not gain anything, but the possibility of this is very dim.

Upon knowing these factors, you can now make your decision on whether you should invest in one or not. If you decide to invest in one, learn as many things as you can regarding the mutual fund company you want to invest in.

Dont stop researching on mutual funds once you invest in one, continue the learning process so you can personally monitor your investment. It pays to be responsible when it comes to your hard-earned money. - 23222

About the Author:

The author's website provides information about mutual funds Philippines and also guide you on how to buy mutual funds in the Philippines.

How Mutual Funds Started

By Jeffrey Mute

Perhaps you are considering mutual funds as a form of investment because youve been hearing so much about it. Questions, like what is it that makes mutual funds so popular and will you be able to benefit from it, enter your mind as you ponder if it is the right type of investment for you. For starters, mutual funds are very popular because it can give impressive returns of investments.

Aside from traditional investment options such as money market accounts and certificate of deposits, a mutual fund is one investment opportunity a novice can take part of. Stock markets and bonds are good investment options, but not all people have the time to learn the ins and outs of the trade. Thus, a mutual fund is perfect for a beginner as it allows you to test the waters before putting a huge amount of money in. A good advantage of mutual funds is the fact that it spreads its assets over several investment vehicles to minimize risks.

But before becoming what it is today, mutual funds underwent several modifications. Historians are still divided as to the actual establishment of mutual funds. Some believe it was during the launching of the closed-end investment companies of King William I in the Netherlands in 1822. Others say it was Adriaan van Ketwitch who came up with the idea of mutual funds in 1774, when he created an investment trust.

Nonetheless, Great Britain and France recognized how sound the investment opportunity is and established mutual fund companies in their respective countries. The United States caught up with these countries only in the 1890s. The mutual fund of today is very much different from the mutual funds of the past. But the establishment of the Alexander Fund in Pennsylvania paved the way for the modern version of the mutual fund. In the following years, features like the ability to do withdrawals on request and semi-annual issues were added.

It was only with the establishment of the Massachusetts Investors Trust in 1924 that the modern mutual fund came to be. Roughly a year after the creation of the Trust, it has acquired assets totaling to almost $400,000.00 with 200 shareholders. In 1928, the fund offered its shares to the public. In the same year, another fund called the Wellington Fund was established. It was the first fund to include stocks and bonds as their investment options. Because of this the prices of stocks continued to rise making 1928 one of the most glorious years in mutual fund history.

Not long after came the Wall Street Crash of 1929. This was the worst stock market crash in history, which led to the Great Depression. But one positive thing emerged from these downtimes. Finally, the government noticed the advantage of the mutual fund industry and subsequently passed several laws to protect the investors.

This move was welcomed by the investors and trading in the stock market began to increase again. From then on, the mutual fund industry continued to flourish. Throughout the decades, more and more people become interested in mutual funds with its popularity ever climbing.

Now, it has continued to thrive and has become the most preferred investment option of investors. Mutual funds have truly proven itself throughout the years. Thus, you wont really wonder why a lot of people want to invest their hard-earned money in mutual funds because the industry has great potential to grow even more. - 23222

About the Author:

The author's website provides information about mutual funds Philippines and explains the history of mutual funds.

Jump Start Strategy:" A Forex Trading Course That Will Put You On The Right Track

By Bart Icles

"Deciding to take up a good forex trading course starts with a desire to learn and a drive to become a great trader. Learning forex strategies takes dedication and a good teacher. Once you learn how to trade and do so successfully, however, your life will change and you will have options and financial resources you never had before." - Kirk and Jed Norwood

Business partners and father and son tandem Kirk and Jed Norwood have this mindset when they decided to develop a free Forex Trading Course which is specifically designed to teach those who are seriously thinking of venturing into forex trading and making it a steady means of financial resources especially during these trying times. Approximately 5 years in the making, this Free Online Forex Trading Course, which they tagged the "Jump Start Strategy," is strategically designed to, yes, jump start cash flow daily, ranging from 25 dollars to 300 dollars a day. This forex trading course is tailored specifically for Forex trading beginners, experienced Forex traders, and just about anybody else who wants to make their trading strategies a step higher than their usual strategies. The course is presented in an easy to understand video tutorial-like sessions.

Kirk and Jed Norwood are the brains behind Freedom Investment Group, Inc. which they established in June 2006. Their company specializes in foreign exchange market trading, tax management, and self governed investing. Just last year, they have launched their website known as ForexStrategySecrets.com, a site which offers free Forex tips and strategies, including the Jump Start Strategy.

The Forex trading course developed by the Norwood brothers includes strategies on setting up and using the trading platform like a pro (which they deem more important than anything else in the Forex market). It also includes and explains in detail which indicators are supposed to be used to maximize your Forex trading. It also a venue wherein the amount of money a trader should be trading is determined to make sure it's as risk free as possible. It also teaches traders when to get in and out of a trade and which currency pairs are best to follow. And best of all, the free Forex trading course also teaches traders how to use the different strategies that were formulated on any time frame.

This free online Forex Trading Course have helped and is still helping a lot of Forex traders develop a more strategic approach to the Forex market. It has also given them more sense of security since the course outlines how the risks can be overcome by common sense and vigilance. - 23222

About the Author:

Forex trading systems are powerful when coupled with a desire to learn and a drive to become a great trader. Learning a forex system takes dedication and a good teacher. But once you learn how to trade and do so successfully your life will change and you have options and financial resources you never had before.

What Affects The Forex Markets in the Short Term?

By Hass67

Fundamental traders depend on fundamental analysis in trading forex. Technical traders depend on technical analysis in trading forex. But the importance of economic data cannot be underestimated in shaping trading strategies.

Over 90 percent of currency transactions are done against USD. USD is either the base currency or the counter currency in most of the currency trades.

Choosing the right currency pair to trade is very important for you. USD is the most important currency and most probably you will be also trading USD most of the time. You should know that the release of certain economic data has significant and lasting impact on USD.

You should know as a forex trader that currency markets reaction to the release of different economic data with time also changes. Some years back, US GDP figures used to be important for US Dollar but dont have much impact in recent years.

EUR/USD is the most liquid pair in the forex market and is heavily traded. The release of Nonfarm Payrolls (NFP) data on the first Friday of each month has become important in recent years. These figures makes EUR/USD and other pairs involving US Dollar highly volatile for some time until the markets digest the importance of these figures.

Some years back, the release of US housing sales number figure every month was not significant for the currency markets. But these figures have become very significant for US Dollar in the recent years especially after the US housing market crash. Forex markets used to give more weight to US Trade Balance figures in the past but they dont react to these figures much now.

If you are a range trader who likes to scalp for a few pips every trade, you should avoid trading on the day NFP data is released. Release of NFP figures makes the markets jittery and highly volatile.

However, as a breakout trader, understanding of which economic data is expected to be released can help you in your trading. You should plan your trades in accordance with the importance of the economic data to be released.

In short, knowing what economic indicators move the forex markets most is very important for you as a trader. It is important for you to understand which data the market deems important at any point in time.

You should also know which data causes knee jerk reaction in the markets and which pieces of data will have lasting reaction in the forex markets. - 23222

About the Author:

Mr. Ahmad Hassam has done Masters from Harvard University. He is interested in day trading; stocks and forex. Read about Trend Forex System. Best Forex Signal Service. Learn Forex Trading.