June 1, 2021
Last Updated
This week we discuss a new tax incentive similar to (but better than) a 1031 exchange, where you can save up to 15% on capital gains.
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Have a Question for Mark J. Kohler about Opportunity Zones?
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Show Notes:
0:00 – 0:45 Eric Introduces the show.
0:46 – 1:27 RentPrep has worked with attorney, CPA, and best-selling author Mark Kohler on several important topics in the past. Check out Podcast Episode #180 to hear him about protecting your assets by forming an LLC.
1:28 – 2:30 What is an “opportunity zone?” If you own real estate right now, and make a sale at a profit, the profit margin is referred to as capital gains. You have the chance to invest capital gains into a real estate partnership, where you’ll buy real estate in an opportunity zone, to defer some of the taxable gains from the sale of your original asset.
2:31 – 3:40 A snippet from Mark Kohler called “Opportunity Zone Strategies” You can check it out on YouTube. Mark has 5 strategies that you can use to really benefit from opportunity zones.
3:41 – 4:35 Defer the taxable gain on your property. If you make a 10% profit on your sale, then that 10% is all you’d have to use toward investing in an opportunity zone to defer gain taxes.
4:36 – 5:12 Any capital gain is eligible for investing in opportunity zone. Even stock gains.
5:13 – 7:12 The gain is reduced over time. The longer you hold the property, the lower the taxable gain gets. If you hold the property for 5 years, the gain is reduced by 10% if you hold the property for 7 years the gain is reduced by another 5%. The tax deferment period ends in 2026, when you’d pay the reduces taxable gain.
7:13 – 8:14 There is an exclusion for taxed appreciation value. You pay zero tax on any appreciation on the property’s value during a sale if you hold it for at least 10 years.
8:15 – 10:12 Be sure to get the opportunity zone into an LLC. These properties are typically in dilapidated areas you should protect them and yourself.
10:13 – 10:41 “Knowledge speaks, wisdom listens.” -Jimi Hendrix
10:42 – 11:07 Live interview with Mark Kohler on opportunity zones. October 26th 1pm est. Check it out on the RentPrep for Landlords Facebook page.
11:08 – 12:41 On October 20th you can see a scheduled post for this interview. Leave any questions you may have on the scheduled video post, so we can answer them during the live interview!
12:42 – Eric closes out the show.
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Resources Mentioned in this Episode:
Mark’s Video:
https://www.youtube.com/watch?v=tOqm9qDumT8
Our Facebook Page where the live video interview will be held on October 26th as 1pm EST:
https://www.facebook.com/pg/tenantscreening/videos/
Articles mentioned in video:
https://kkoslawyers.com/the-new-and-wonderful-world-of-oz-opportunity-zones-provide-tax-deferral-tax-reduction-and-tax-free-gain/
https://kkoslawyers.com/what-is-a-qualified-opportunity-zone-fund/