5 Promising Cryptocurrencies That Might Make Big Moves in 2020

Like any investment, the cryptocurrency market has its ups and downs. However, the market recovered in 2019 and shows signs of huge growth potential for 2020. You can get the most out of this capitalization if you invest in promising cryptocurrencies.

You may think only experts can figure out how to make the right plays when investing in crypto, but that’s far from the truth. It all comes down to doing your research and learning as much as you can about the market.

Don’t know where to start? We’ve got you covered. Here are the top 5 cryptocurrencies to watch in 2020.

1. Bitcoin

With its ups and downs, Bitcoin remains one of the most popular crypto investments. This popularity will make it the crypto investment with the largest capitalization in the market.

This cryptocurrency experienced a massive decline in value last November. However, Bitcoin’s market capitalization will help it rise in the market in 2020.

2. Litecoin

While Litecoin isn’t as big as Bitcoin or Ethereum, it represents a good opportunity to capitalize on its market potential. If you choose to invest in this cryptocurrency, you won’t risk a lot since it’s one of the cheapest investments on our list.

Buying low isn’t the only advantage of Litecoin. This crypto investment has the potential to become a global transaction network making it a great addition to any portfolio.

3. NEO

The price and versatility of NEO make it a crypto investment with high growth potential. This cryptocurrency combines real and digital assets. Its features have placed this investment under the Chinese government’s radar making it even more appealing to investors.

If China decides to invest in this cryptocurrency, NEO will turn into a major player in the crypto market. It may even become the most profitable cryptocurrency in 2020.

4. Ethereum

Ethereum’s popularity might have it at the top of your list. While its price is on the higher end, this crypto investment showcases growth potential for 2020.

The demand for its smart contracts may increase its value. However, the lack of recognition of Ethereum as an altcoin may impact its growth potential. While Ethereum may look like a safe bet, you should monitor it closely before taking the plunge next year.

5. Ripple

This cryptocurrency may be the cheapest option on our list, but it has been making headlines due to its technology. Companies such as Western Union and Visa are considering using Ripple’s technology to speed international payments. If the banking industry embraces this technology, the value of this crypto investment will skyrocket.

While growing your crypto portfolio is the ultimate goal, you should also keep in mind any potential tax liability. You should consider getting a simple crypto tax software to make sure you meet your tax obligations.

Will Investing in Promising Cryptocurrencies Make a Difference?

Making the best crypto investments is a science that comes down to learning about the market and monitoring the most promising cryptocurrencies. However, it will depend on your strategy and investment objective.

While it may be difficult at first, you’ll learn to time the market as you keep making investments. Use our cryptocurrencies watch list as your guide to plan your investments for 2020. Keep in mind not all crypto investments will fit your strategy so you should adjust your plan according to your investment purpose.

Did you find this article useful? Check out the rest of our site for more interesting articles.

A Comprehensive Guide to Homeowners Insurance Coverage

To file or not to file?

When you don’t know how your homeowners insurance coverage works, it can cost you big time financially. Every year about 20% of all home insurance claims related to water damage. Yet, that doesn’t mean these claims payout.

Instead, homeowners often find out that because the water damage was a result of negligence, they have to pay themselves. On top of having to cover the damages, the homeowner might have to deal with a rise in their insurance rates.

Even when a water damage claim doesn’t payout, it’ll still exist on your claims history. A bad claims history can make your insurance rates can skyrocket and your provider may choose to non-renew your coverages.

Knowing what your policy covers, and when to file a claim, is the best way to protect your financial future. Read on to learn everything you need to know about home insurance coverage.

Understanding Homeowners Insurance Coverage

Your homeowner’s insurance coverage will protect your house, belongings, and finances. Each specific policy will have its list of coverages and coverage limits. These coverages are what will pay to repair or replace things in your home, as well as your belongings.

It’s important that you fully understand when your homeowner coverages will apply, and when they aren’t eligible. Your policy binder will have a list of Perils, that has to happen for your insurance policy to activate.

A peril is a type of event, like a fire or robbery, that can cause damage to your house or belongings. Here’s a list of Perils that home insurance policy’s usually cover:

  • Fire
  • Smoke
  • Lighting
  • Windstorms
  • Hail
  • Explosion
  • Vandalism
  • Malicious mischief
  • Damage from a car
  • Damage from an aircraft
  • Falling objects
  • Water damage
  • Ice, snow, sleet damage
  • Theft

Typically earthquakes and floods will require you to have a separate policy. Sometimes homeowners become confused when it comes to determining whether something qualifies as water damage or flood damage.

Luckily you can use a claim service, to help walk you through the insurance claims process. To make sure your house is fully protected, it’s always a good idea to have both a flood and home insurance policy active at all times. The only exception would be if you’re not in a flood-prone area.

Also, if you live in a state that’s prone to hurricanes, make sure you have a reasonable hurricane deductible. While hurricane damages are typically covered on home insurance policies, they often come with high deductibles.

While high deductibles are great for low monthly premiums, they can make it difficult to recover after a major storm. Since hurricanes are unpredictable beasts, make sure your deductible is low enough for you to pay it at a moment’s notice.

No Insurance Payouts for Negligence

When damage occurs to your house and it’s a result of your negligence, it’s unlikely your insurance will cover it. For example, let’s say you replace the wiring in your living room, and it causes a fire. Your insurance policy won’t pay for the damages since if you’d hired an electrician to perform the work, the damages may not have happened.

The same holds if you experience a loss as a result of a preventable theft. If you left your house with your front door open or didn’t lock the door, the insurance company isn’t on the hook to pay. It’s up to you as a homeowner to fulfill your responsibilities to make sure your house is reasonably secure.

Home Insurance Coverages

On top of knowing when your insurance policy will become active, you should also know what it’ll pay for. Here’s a shortlist of the different types of home insurance coverage:

  • Dwelling protection
  • Other structures
  • Personal property
  • Liability

The most standard of all homeowner’s insurance coverages is your dwelling protection. The dwelling coverage is the protection that will help pay for the structure of your home. This includes your house’s foundation, walls, and roof. The dwelling protection can also cover structures that attach to the home, like an attached carport, or garage.

Next, we have the other structures coverage. The other structures coverage will protect any structures on your property that aren’t attached to your house. For example, a shed in your back yard would qualify as the other structure and would fall under this coverage.

Moving on, we have the coverage for your personal property. All of your furniture, electronics, and other personal items fall under this coverage.

Keep in mind however that there are specific categories for the property your policy will cover, and limits for each category. For example, there’s a strict limit for the amount of jewelry or paper money policy that will replace. You can always look into purchasing additional coverages, or extended coverage if you feel your current policy limits aren’t enough.

Finally, liability protection will help pay for the medical costs of someone getting hurt on your property. You have to be at fault for the individual’s injuries and they can’t be a member of your household, for liability coverage to apply.

Don’t Compare Policies

Each individual policy has coverages and costs that are carefully calculated on a per house and per person situation. Your house’s age, material, and history will all play a part in determining the coverage you’re eligible for. The same holds for you as a person.

Your age, career, and financial history will directly impact what you pay for home insurance. If you want to find ways to lower the cost of your homeowners insurance coverage, go directly to your insurance company and ask for help.

Even if they can’t get you a lower price, they can at least clearly explain why you’re paying the price you are. When it comes to financial success, knowledge is the ultimate power. See what our money experts have to say in our Finance section today!

4 Jobs that Allow You to Make Your Own Schedule

Sometimes you don’t want a typical 9-5 job. Even with modern HR departments and their fancy—and admittedly highly effective—HR platforms, you might not want to deal with the stress of the classic hiring process. All those phone calls, interviews, and drug tests. 

You would like the freedom to pursue your own passions and your life outside of work, but also want work that is fulfilling. Maybe you pursue another passion part-time and need job flexibility. No worries, there are many different kinds of work that allow you to create a schedule outside of the standard work-day that works for you. 

Here is a list of 4 jobs that allow you to make your own schedule. 

Freelance Writer

If you have strong writing skills, and a background in marketing or another specific field, you may want to consider being a freelance writer. Many marketing companies look for a content writer to help them write articles for their clients. Most articles are 500-700 words, and marketing companies typically pay per article. Or, you could even ghostwrite. People often look for others to help write articles, blogs, memoirs, or other content. 

Freelance writing is wonderful because you can write at any time, at any place so long as you meet the deadline. You can look up writing gigs on Craigslist under the writing category to find a gig that best suits your creative and financial needs. 

Eyelash Technician

If you are interested in aesthetics and helping people look their best, you might consider training to be an eyelash technician through an eyelash extension course. Many courses offer eyelash technician courses online, or in-person. Search for some eyelash technician classes near you. Typically, in-person courses will be available in most big cities. 

However, if there are no available in-person courses, considering looking at eyelash technician certification online. You have plenty of options for helping others feel their personal best. This is also true for those who are extremely detail-oriented and enjoy scheduling their own lives. 

Private Tutor

Consider private tutoring if you feel confident in a certain academic subject, music, and the like. You can become a private tutor through some kind of studio or academy, or you can freelance private tutor. The hours are extremely flexible, as you get to decide when, and how, you work. Try reaching out to people with children still in school, who need help in a particular subject such as history or math. Or, consider your own personal talents and see what niche markets there may be to educate others–all for pay. 

Dog Walker

If you have a love for animals and light exercise, why not consider being a dog walker? You can look at dog walking companies to see if there are any availabilities in getting a job. Dog walking is extremely fun if you particularly love dogs, and want to get some casual exercise in your day. If you don’t want to go through a company, reach out to friends and family who may work during the day, and need someone to check in on their pooch to make sure they get adequate exercise. You can make your own schedule, and find out what approach works best for you. 

These are just a few options to work while having freedom in your life. Look at these jobs that allow you to make your own schedule, and find whatever works best for you! 

4 High Risk Investments That Could Pay off Big in 2020

Do you regularly invest in stocks? If so, you know you are trading risk for the possibility of rewards. While this is true, there are some stocks that have higher risks – and the possibility of higher rewards – than others.

If you are interested in high risk investments, you probably want to make the safest, high risk investments possible. Keep reading to learn more about some of the best options to consider in 2020.

  1. TEVA – Teva Pharmaceutical

This company isn’t having that great of a year. It’s down over 44 percent and still falling.

The issue is that Teva has limited growth and significant debt. It’s primary drug, Copaxone, used for treating multiple sclerosis, is facing competition from generic versions of the same medicine, such as Mylan.

Bankruptcy for Teva isn’t a near-term scenario; however, the trajectory the company is on now shows it may occur in the future. Put simply, TEVA is the classic case of “buy when there’s blood in the streets.” There are several reasons that TEVA is considered one of the great, yet risky, stocks to consider buying in 2020.

Even though there’s been pressure on generic drugs, it isn’t going to last forever. The company has already begun to sell assets to clean up its balance sheet. This has helped de-risk the story a bit.

While it’s a risky path, if TEVA is able to gain 20% (or more) by reaching a higher multiple, it can remove the possibility of bankruptcy – and result in potentially significant gains.

  1. Trulieve Cannabis

There’s no question that investing in the cannabis industry is a risk. After all it’s illegal at the federal level in the United States. However, if you are an aggressive investor, you may want to consider looking at Trulieve Cannabis for a few reasons.

This company is considered a rarity among cannabis stocks because it’s already profitable. In the second quarter, Trulieve reported record-high earnings and revenue.

Also, the company is focused on Florida’s medical cannabis market. The state offers a great opportunity for those in the medical cannabis industry because many people are moving to the state when they retire. Also, at this point in their life, individuals are much more likely to suffer from conditions that require cannabis use.

Even more, it’s predicted that the state of Florida may legalize the use of recreational cannabis, with there being an amendment set to appear on the 2020 ballot for this purpose. Trulieve is supporting these efforts, which means the industries present in the state poses the possibility of significant growth and returns.

Even if the efforts above aren’t successful, there’s plenty of room for this company to grow in this market. You may even want to consider shorting a stock for this purpose. While it’s risky, the possibility of significant returns is huge – especially if the Florida amendment is successful.

  1. SFL – Ship Finance International

When it comes to investor capital, the shipping space has long been considered a “Bermuda Triangle.” However, with Ship Finance International they may be the exception to this rule.

There is probably going to be some near-term volatility and the dividend for Ship finance may be at risk, it’s still a good stock to consider if you are in a position to handle the risk.

When it comes to the shipping industry, this is still considered one of the best potential moves to make. The industry, along with a leveraged balance sheet, both demonstrate this risk, along with the potential rewards.

If Ship Finance can make it through the tumultuous waters it faces in the next few months, there’s the possibility of a significant return for shareholders.

  1. Baozun

According to some metrics, Baozun doesn’t really look as high risk as far as growth stocks go. The company is trading at approximately 30 times the year’s expected earnings, and it’s managed to grow an adjusted net income of 65 percent and 46 percent in the first and second quarters of the year.

It’s not as if things are going bad for this Chinese e-commerce service provider on the revenue side. Sales have been up throughout the year.

Baozun also has an above-average risk profile when it comes to creating a list of stocks that are worth building a portfolio around. That’s not because the business doesn’t have longevity, however, there are several factors that go into a company’s stock price and performance.

Even though the company has posted profits and sales in the second quarter that came in ahead of the expectations for the market, the stock for Baozun fell double digits after the second-quarter earnings results. Also, the ongoing trade war between the U.S. and China has resulted in another turn for the worse.

While the trade situation has put Baozun as a risky short-term play right now, the underlying business is still sound. As a result, it makes a smart move for long-term investment purposes.

The Best High Risk Investments to Make

When it comes to smart, high risk investments, there are more than a few opportunities to consider. The list here gives you an idea of what stocks to look at going in 2020 that provides the biggest opportunity for a return.

When it comes to money, investing, and protecting your wealth, we have you covered. Be sure to check out our blog often to see what other types of helpful information and insight about your financial situation can be found.

Savings Quickly Add Up: What Are the Tax Benefits on Term Insurance?

There are tax benefits in places you wouldn’t think like the opportunity in an online term plan. A term plan is what they call “pure insurance” because it covers you without frills. It protects all your needs at an affordable cost with an inventory of options to expand the insurance.

Or, you might prefer a tax savings investment to achieve your financial goals actively while protecting your family, retirement, or business plans. There is a plethora of plans available to help your savings quickly add up.

Term life Insurance

The Economic Times notes that, with term life insurance, “financial security for nominees in case of death of the policyholder.” At the same time, it promises a set amount in the case of your premature death to fulfill your family or business financial needs.

Term life differs from other investment vehicles like fixed deposits or mutual funds. You might only enough insurance to pay your funeral expenses, to cover your mortgage, to provide for your family’s future, or to resolve outstanding business debts.

Term life contracts does not have maturity benefit. So, the cost is affordable, encouraging you to apply for adequate protection. Term insurance plans provide tax breaks under Section 80C of the Income Tax Act. In addition, any death benefit realized on your passing is tax-free under Section 10(10D).

Other life insurance opportunities

Savings add up quickly and safely in several other life insurance opportunities. Those listed here may not be available from all insurance sources and may vary by name:

  • Guaranteed Savings Plans, for example, will help you fulfill dreams as well as your family’s. The plans pay a lump sum benefit on maturity along with guaranteed accumulations on premiums paid.
  • A Super Saver Plan is a participating life insurance policy helping you save while providing a long-term financial safety net for you and your family. And, it comes with a premium waiver that continues to pay the premium should you die or become disabled.
  • Smart Platinum plans link the insurance with an investment portfolio. The investment risk is yours, but the plan helps your savings perform better while insuring your life.
  • And, an Endowment Savings Plan Plus invests your monthly savings deposit. The accumulations let you build a corpus to fulfill your promises, pay off or reduce your mortgage early, prepay a child’s university education, or support your retirement dreams.

The Options are all Yours!

Nupur Anand, writing for Quartz India, warns, “up to 988 million Indians—or 75% of the country’s population, which is more than the population of Europe—do not have any form of life insurance.” The average Indian citizen “has only around 8% of what may be required to protect his or her family from the financial shock.”

Helping solve the problem, online life insurance presents opportunities and options you can afford or customize for your specific needs. The low-cost term life or premium savings plans can solve your security issues with the promise of payment and long-term peace of mind. So, this may be your call to action!

7 Signs You Need the Help of a Financial Risk Manager

There’s a lot of truth to the old adage “no risk, no reward.” However, there is definitely such a thing as taking on more risk than you can handle, and poor risk management has been the downfall of many once-profitable companies.

Are you unsure of how well your business is handling financial risk? Do you want to make sure you don’t make the same risk management mistakes that other business owners do?

Read on to learn about some of the most pressing signs that you need the help of a financial risk manager.

What Is a Financial Risk Manager?

A financial risk manager (or FRM for short) is a professional who specializes in assessing risks for a variety of businesses, including the following:

  • Banks
  • Insurance companies
  • Regulatory agencies
  • Accounting firms
  • Asset management firms

In addition to identifying certain financial risks, FRMs help business owners to analyze these risks and come up with plans to avoid getting in over their heads.

FRMs have received accreditation from the Global Association of Risk Professionals. To do this, they must pas a two-part exam and spend two years gaining work experience in the financial risk management field.

Signs You Need to Hire One

Not every business needs to have an FRM on their staff. However, they can provide a lot of assistance, especially when you bring them on at the first sign of trouble.

Here are some signs to be on the lookout for that may indicate you need the help of an FRM:

1. You’ve Gone Off-Script

When you first started your business, you likely had a business plan that you were following fairly closely.

A good business plan helps to give you guidelines and a road map to follow when getting your business off the ground. It helps you manage funds in an appropriate way and ensure your business is profitable.

If you’ve gone off-script and haven’t been following your business plan, you might not be on track to be as profitable as you’d like. This is where having an FRM come in and evaluate your position from an objective standpoint can be beneficial.

2. You’re Not Adhering to Regulations

One of the biggest frustrations for business owners is the abundance of regulations (local, state, and federal) that they have to follow.

When it comes to your finances, have you been following all of these regulations and rules to the letter, or have you just been winging it and hoping for the best?

If the latter is true, it’s a good idea to get an FRM to come and evaluate things. They can help you get back on track and ensure you’re in compliance with all finance-related regulations for businesses in your area.

3. There are Issues with Operations

There may be issues with day-to-day operations that are impacting your business’s profitability and financial well-being.

This could be problems with employee production and productivity, technological issues that are dragging the company down, or even natural disasters that halt operations and have an effect on your bottom line.

FRMs can help you navigate these problems with more ease and help you come up with a solution that won’t put your business at risk from a financial standpoint.

4. The Market Is Unstable

When the market shifts or is particularly volatile, a lot of business owners start to panic. Instead of making rash decisions based on emotion, it’s better to hire an FRM who can look at things with more of a global perspective.

They can review your current financial situation and let you know how you’ll fare if the market continues in the direction it’s currently headed. They can also help you make a plan to pivot and weather the storm without going under.

5. The Economy’s Shifted

Economic shifts can also spell trouble for business owners who aren’t well-prepared. If a major economic shift has occurred, such as a recession, you need to work with a professional to figure out where your business stands. The sooner you can do this, the better off your company and your employees are likely to be.

6. You’re Having Trouble with Internal Processes

Internal issues can wreak havoc on a business’s financial situation. For example, if you’re dealing with several vendors who aren’t paying or delivering on time, this could slow down all of your operations and make it harder for you to pay your employees or deliver products to your customers.

An FRM can help you evaluate these situations and figure out where your money’s going.

7. New Laws Are in Effect

Have new laws recently gone into effect that could have an impact on your business’s financial health? If so, it’s a good idea to bring in a risk manager and have them assess your current situation. They can help you make sure you’re complying with these laws and adjust your spending to make sure they don’t derail your business.

Tips for Choosing the Right Financial Risk Manager

Have you spotted any of these signs? If so, you need to start looking for an FRM sooner rather than later. Follow these guidelines to ensure you’re hiring the best FRM for your business’s needs:

  • Consider Their Education: Have they passed the exam to become an FRM (FRM Part 1 and FRM Part 2?)
  • Ask About Their Experience: Have they worked with businesses like yours in the past?
  • Assess Their Temperament: Can they communicate well with you and your colleagues?
  • Don’t Forget Their Fees: Are their rates fair and something you can afford?

Asking yourself these questions will help you get the best person for the job.

Hire a Financial Risk Manager Today

Now that you know more about what a financial risk manager does and how they can help their business, do you think it’s a good idea for you to consider hiring one?

If you’ve noticed any of the warning signs outlined above, chances are good that having a risk management expert on your team will help more than it’ll hurt you.

Keep these tips in mind as you begin your search to ensure you’re hiring the best FRM possible. Visit the Finance section of our website, too, for more helpful resources.

Signs You Need To Hire Property Managers

Owning rental property is a smart investment. It may seem like purchasing several properties, finding responsible tenants, and reaping the financial rewards will be easy, but you may quickly realize that it may be more complicated than you thought. Marketing your property, selecting tenants, maintaining your property, and meeting property laws can be overwhelming. While you may try to handle all the tasks on your own, you are not likely to do them as professionally as required. If you are feeling overcome by all the new to-dos on your list, it’s time to hire a property manager. A good property manager can be a worthwhile investment for you and your investments. Here are some of the benefits you will see from taking this step.

Prompt Response to Repairs

When you hire property managers in Austin (or whichever city you live in) you gain a strong partner that can help with repair requests. When a landlord doesn’t have time to address repair tasks in a timely manner, tenants can become upset. Leaving repairs unattended for a long time can also be costly. Not only could you risk losing your tenants but your property could experience damage. Save yourself time and money by hiring a property manager.

Managing Multiple Properties

Owning multiple rental properties can be a great way to build your wealth but, if you find yourself overwhelmed or strapped for time it may be a sign that you need a property management company to assist you. You can hire the company to attend to all your rental properties, without compromising any of them. Property managers can keep tabs on multiple sites much easier than one landlord can. They can find the right tenants and make sure the parking lots and landscaping are maintained too. They provide multiple checks and balances to keep up your investment.

They Can Help You Find New Properties

Building your financial portfolio is crucial for continued growth. If you hire the right property management company, they can even help you watch for new investment opportunities. Austin Luxury Realty is an example of a team of real estate professionals that work in all aspects of the market including, buying, selling and property management.

Owning rental properties is a great idea. However, managing them on your own without professional assistance is a lot of work. Research the property management options in your area and find a company you can trust.

The 1031 Exchange Timeframe: A Guide for Businesses

Investing in real estate seems like a great way to build wealth. There are dozens of stories that still tout real estate investing as the best way to make money.

At the same time, there are a lot of unknowns and a lot of risks. There are also capital gains taxes and other tax rules to navigate. Those taxes could eat up a good percentage of your profits.

You can use a 1031 exchange, but you have to do so within the rules and timeframe. Read on to learn more about this option and the 1031 exchange timeframe so your transactions are successful.

Why Use 1031 Exchange?

When you sell a real estate property, there’s a good chance that you’ll sell it for a price that’s higher than what you bought it for. Housing prices have been going up over the last few years, making it likely that you’ll see a profit.

That profit is called capital gains.

The IRS requires that you pay taxes on capital gains, whether it’s for a real estate investment, stocks, bonds, or artwork.

How much taxes you need to pay depends on how long you hold on to the asset and which income tax bracket you’re in.

If you only hold on to a property for a year, the capital gains will be higher, up to 37%. The capital gains maximum tax rate is 20% for assets held for over a year because it’s considered to be a long-term investment.

The IRS code has a section, called section 1031 that allows you to defer capital gains taxes for real estate sales. You roll the proceeds of the sale of your property into another property.

1031 Exchange Timeframe and Rules

A 1031 exchange might seem like a great way to avoid taxes. You only get to defer taxes, not avoid paying them altogether. You would have to keep buying replacement properties if you wanted to avoid paying taxes altogether.

Think of a 1031 exchange as a tool that you can use to lower your tax burden. You can be strategic about when to use it and when you should realize the capital gains and pay taxes on them.

In order to make a 1031 exchange work, you have to have the transactions meet the IRS’ requirements and all within their timelines. Here are the main rules and the 1031 timeframe.

Property Must Be Like-Kind

The first rule to know about 1031 exchanges is that the properties have to be like-kind. There is a lot of leeway around this. You can have an empty lot and exchange it for a multi-family home.

The value of the properties does need to have a similar value or the replacement property has to have a higher value.

You might be wondering why you haven’t heard of this option as a homeowner who’s bought and sold properties. A 1031 exchange only applies to properties that are for business or investment purposes only.

A residential property does not qualify, like your primary residence or vacation home.

1031 Exchange Timeframe

The 1031 timeline is often the most challenging part of the entire transaction. You need to make sure that you understand when properties need to be identified and purchased and file the paperwork with the IRS.

When you sell your property, the timeline begins. There are 45 calendar days to find a replacement property. You then have 180 calendar days from the sale of your property to close on the sale of the replacement property.

If you purchase sell a property and April 15th (or whichever day is Tax Day) falls within the 180 day period, you have to complete the purchase by April 15th.

If it’s impossible to close the deal in a shorter timeframe, you can file a tax extension. If you owe other taxes, you still have to pay what you owe by April 15th. If you file an extension and pay your taxes later, you will be charged penalties and interest.

You Can’t Do a 1031 Exchange by Yourself

As you can tell, there are a lot of potential issues with a 1031 exchange. If you miss any of the deadlines, you will have to pay capital gains taxes.

You have to use a firm, or a person called a qualified intermediary. They are the holders of the proceeds of the sale of your initial property and help you handle the paperwork required.

The thing to remember is that they handle the money. The moment any funds from the sale of the property are in your hands, you have to pay taxes on them.

What Happens When You Want to Exit Real Estate?

For many property owners, they’re doing the maintenance and management of the properties themselves. Being a landlord is challenging.

At some point, you’re going to want to get out of real estate. Do you sell your properties altogether and pay capital gains taxes?

There may be a way to realize the benefits of a 1031 exchange, retire as a landlord, and see regular real estate income. That’s through a Delaware Statutory Trust or DST. These reasons explain why you want to explore this option.

Understanding Capital Gains Deferments

Taxes are complicated. They’re even more complicated when you’re dealing with investments like real estate. You can defer your real estate capital gains by leveraging a 1031 exchange. This lets you sell one property and purchase another without paying capital gains taxes right away.

You have to understand the 1031 exchange timeframe. If you can remember 45 days and 180 days, that’s half the battle. If Tax Day, falls in the middle of 180 days, do everything you can to finalize the purchase by then.

Keep checking this site for more great business tips and articles.