Key Players in 1031 TIC Investments

Couple meeting a broker about property investment

Couple meeting a broker about property investmentProperty investment is a landmine, so due diligence is essential. One of the vital areas in property investing is the taxes involved in your transactions.

Though property investment taxes might be substantial, the IRS code 1031 allows you to defer your taxes and grow your wealth fast.

A tenancy in common (TIC) investment is one which allows you to co-own commercial property with other investors. 1031 TIC investments like the services offered by 1031 Exchange Place can be difficult to navigate when you don’t have much expertise in the matter. Here are some key players involved in these investments.

Qualified Intermediary

This expert drafts all legal documents required to structure your properties properly for a 1031 exchange transaction. They hold and preserve the settlements from your sale proceeds to keep you from getting constructive receipts on your assets and triggering an event which will be taxable. A qualified intermediary will also review your transactions for federal code and regulation compliance.

TIC Sponsor

The stringent financing and equity requirements of a large commercial real estate might prove a hindrance to small-scale TIC investors. TIC sponsors have interests in large properties and allow small investors to purchase small or fractional property interests. These interests are called TIC interests and are sold as like-kind replacements for 1031 exchange investors.

TIC Broker

A TIC broker mainly serves a supervisory role in your transactions. These professionals are licensed and will help you identify the best deals in the market for your 1031 TIC exchange investment. The broker will also help you scrutinize your PPM (private placement memorandum) that contains all the information related to your transaction.

With the above players involved in your 1031 TIC transaction, you can be sure that you won’t suffer any buyer’s remorse about your investment. When handled well, a 1031 TIC investment frees you from the daily hassles and headaches of property management and greater liquidity. It also saves you on regular closing costs and property appraisal fees.