SPRING PROGRAM – Real Estate Tax Issues
This program provides guidance on various real estate tax issues faced by practitioners advising clients or preparing income tax returns involving real estate. You will learn types of issues a client may face, ways of avoiding adverse tax results, and consequences of noncompliance.
This is an intermediate level program for participants with a background in federal income taxes. There are no prerequisites and no advance preparation is required. The program is a group live lecture and will include a written course book. At the conclusion of the program participants will understand special tax issues involving real estate.
Topics will include:
- Personal residence gain exclusion: “Unforeseen circumstances” permitting less than 2 years’ use; allocations for change in use; portion of structure as residence; principal residence if more than one; contiguous property as part of residence; unmarried or divorced individuals; residence held in revocable or irrevocable trust; life estate; sale by decedent’s estate; repossession trap after exclusion of gain on sale of residence with owner financing
- Like-kind exchange: Review of deferred exchange rules; real estate interests that are and are not like-kind; combining with principal residence exclusion; partnership drop and swaps; reverse exchanges; build to suit; related party issues; tenancies in common (TICs); personal use safe harbor; installment reporting of boot; basis issues; nonqualifying personal property portion of real estate (including exchanges of cost segregation property); disregarded entities
- Involuntary conversions: Meaning of involuntary; events constituting and not constituting involuntary conversions; amount required to be reinvested; qualifying replacement property; replacement period chart; special rules for principal residence; basis of replacement property; election and reporting requirements
- Depreciation: Distinguishing between buildings/structural components and personal property for MACRS purposes; cost segregation studies; recapture
- Capitalization: Guide to distinguishing between improvements and repairs, including decision checklists; lists of items commonly treated or not treated as improvements
- Passive activities: Real estate professional status; defining activities that include rental real estate; whether to elect to group rental real estate activities and consequences; rental real estate recharacterization issues; small investor $25,000 passive activity exception; decision checklists for real estate passive activity issues
- Other: How rental real estate becomes subject to self-employment tax; Airbnb and other short-term rentals; farm real estate; easements; treatment of personal residence with built-in loss as investment or rental property; disadvantage of real estate held as investment property rather than as trade or business property