1031 Exchange

[nick8086]

1031 exchange  - can i sell 6 cars and buy one car for more money and not pay any gains??

 

Can it be a 2018 car or does it have to be a Antique car..

Edited March 24, 2018 by nick8086 (see edit history)

[trimacar]

Quicksand.  Previous tax laws would allow you to exchange the six antique cars for another, more expensive, antique car (not new, it had to be similar kind).  The cars had to be held and treated as investments, not for "personal use or enjoyment".

 

The new tax laws state something different, from my understanding, basically stating that antique cars are not a "collectable" eligible for a like kind trade.

 

Ask your CPA, no one here, including myself, will be able to give you proper advice without knowing your specific situation, and being up on the new tax law.

[A. Ballard 35R]

John Draneas, tax attorney in Portland, Oregon, specializes in antique/Classic car tax matters and is recognized as being an expert.

[mtnchev]

Nick:

If I remember correctly (I was a CPA about 2 lives ago) unless the cars were owned by a separate entity from you personally at the time of sale, they were considered as private assets. That means the gain or loss on the sale of each car would be the amount you got for that one car less the amount you paid for that one car.  Gains from the sales of the cars was taxable, but any losses were not.  A separate entity would be something like a trust or other organization.  A separate comany would have the usual tax laws applied to the sale, and does allow depreciation to be deducted from the original cost of a car, but in the case of a classic car that increases in value, the savings from claiming deprection would be probably much less than the gain on the appreciating car. Partnerships have their own laws but the gain or loss would be calculated the same as a company , and usually any gains from any profit the partnership would be passed through the partnership to the partners and subject to their personal tax rates.  However, the tax laws have been changed a few times since I was in practice, so CHECK WITH A CURRENTLY PRACTICING CPA OR ATTORNEY.  

Sorry for the lecture an old tax laws, just trying to show off what I used to know I guess.

Larry

[alsancle]

The new tax law eliminated 1031 exchanges for collector cars.

[nick8086]

I found it:

 

2017 Tax Relief Act