Any Ways Of Getting Around Capital Gains/Income Tax?
I know there's probably no way of getting completely around taxation, but how does everyone go about making a profit, without uncle same taking a big chunk out of your income? I know that one way is to reinvest the entire profit wihin 45 days (or something like that). But if you have to reinvest the ENTIRE profit, then how do you actually make money to spend without getting hit by the gov't?
two ways which I use in combination to minimize taxes.
1) 1031 exchange
2) cash refi out of property & spend loan proceeds
1st, a 1031 exchange is the only way I know of to actually not get taxed on your income, but since you have to reinvest ALL of your income to qualify, you don't get to spend any.
2nd, a cashout refi will NOT help with your taxes whenever you realize a profit. In fact, it could actually hurt you because your tax basis is figured upon your purchase price, not loan amount.
3rd, talk with your tax advisor on how to legally limit your taxes, but pay them when they're due. It means that you actually made some money.
Roger