As soon as the tax season commences, implementing an effective tax strategy that will go a long way in reducing their tax burden in addition to overhead expenses is a daunting task for most commercial property owners. Fortunately, it is possible for these people to get the tax relief they need by taking advantages of IRS Section 170 Bargain Sale. However, it is imperative for such property owners to take the advice and assistance of competent professionals who necessary knowledge and expertise in the field of taxation in addition to commercial real estate dealings.
The Welfont Group is reputed boutique commercial brokerage corporate enterprise that concentrates in assisting their customers in searching for, analyzing, financing, purchasing , managing and selling properties that fall under the preview of commercial real estates. The company specializes in catering to the specific needs and requirements of property investors in addition to tax-exempt institution employing tax strategies that the IRS approves such as 1031 Exchange along with IRS Section 170 Bargain Sale. This goes a long in ensuring these commercial property owner get the maximum benefits from the purchase and sales of their commercial real estate dealings.
IRS Section 170: Understanding its salient features
The competent experts from this commercial real estate group explains that while tax relief benefits under IRS Section 170 have been around since 1917 to promote philanthropy among property owners not many people are aware of such tax benefits. Moreover, apprehending and appreciating the advantages of IRS Section 170 Bargain Sale can be a tall order for individuals who are a party to commercial real estate business deals. Under this section, it is possible for a property owner to sell his/her real estate property to a charitable institution at a value, which is below its fair market price. In such a transaction, the seller of the property can write off the difference between the actual sale value and the asset’s fair market value as a donation for charitable purposes for purpose of taxation. The most important advantage of such a transaction is the owner of the property can avail the entire monetary consideration for the real estate asset he/she sells while claiming the difference the actual sale value and its market price as tax deduction for charitable causes. This also goes a long way in helping the owner evade the tax liability that relates to the gift portion of the sales transaction.
The real estate and taxation specialists of Welfont Group go on to clarify that it is imperative for property owners to understand the type of real estate assets that come under the preview of IRS Section 170 Bargain Sale, which can finalizes such a transaction. Generally, all commercial real estate assets that come under the category of appreciated properties are eligible for bargain sale, even if they have mortgages attached to them. However, the mortgage from such transactions reduces the philanthropic donations that owner can claim for purpose of taxation. The IRS treats the mortgage debts the owner transfers in the then transaction as cash the sellers receives for tax purpose.