2022 Boise Idaho Real Estate Blog

Consider a 1031 exchange to move your California investment to Idaho

Main Idaho Real Estate Insights

If you have an investment property to sell, you are going to have capital gains taxes, and those are going to hit you pretty hard when you go to sell, especially if you bought in California 40 or 50 years ago and that property is now worth over $1,000,000.

First, let's start with, you should always consult your financial advisor regarding your specific situation including your goals and tax saving strategies.

One option you have is to sell these properties and reinvest that money in Idaho real estate. If you have two properties in California, one a single family residence and one a duplex (for example), and let's say that the two of them are worth $1,500,000, well, that’s also one and a half million dollars invested in only two assets.

When you bring that money into Idaho using a 1031 exchange you can spread that out and minimize the risk by acquiring more properties. Instead of two income producing properties, you can invest in Idaho and possibly buy three or four investment properties. The money you have invested is the same, but you spread out that risk by having more doors.

Think about this... If one of your two properties in California goes vacant for two months you are losing one-third of your income, whereas if you own three or four properties in Idaho and one goes vacant for two months you have spread out the risk.

There are a lot of nuances with the 1031 exchange and we would love to talk with you about how we can make this work for you.

Trey Langford

Posted by tlangford at 1/2/2019 8:32:00 PM

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