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Tenants-In-Common and 1031s
Tenants in common (TIC) properties are powerful tools for real estate investors. A TIC property is one in which you own an undivided interest in a real estate property. You receive tax benefits, income, and growth that is directly proportionate to your interest in the property. A single tenant may own a larger interest than the other tenants. Yet, each owner receives a deed with the rights of a single owner.
TIC properties offer several benefits to real estate investors. Low equity requirements, as low as $100,000 in some instances, allow smaller individual investors to invest in large institutional properties. TIC properties eliminate the hassles of being a single landlord or property manager. Income from a TIC property can often be tax-sheltered through using depreciation and interest deductions.
When combined with a 1031 tax exchange, TIC properties can be even more attractive. 1031 tax exchanges allow you to defer capital gains taxes by investing in a like property. When using TIC properties with a 1031 tax exchange, you can defer capital gains while diversifying your investments. You can purchase shares of various TIC properties in different locales with the proceeds of the 1031 sale.
>>Types of TIC Investment Programs
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