Identification Period
Within 45 days of selling the relinquished property you must identify suitable replacement properties. This 45 day rule is very strict and is not extended should the 45th day fall on a Saturday, Sunday, or legal holiday. The following rules of identification apply:

3-property rule
You may identify any three properties as possible replacements for your relinquished property. More than 95% of exchanges use the 3-property rule.

200% rule
You may identify any number of properties as possible replacements for your relinquished property as long as the aggregate value of those properties does not exceed 200% of the value of your relinquished property.

95% exemption
You may identify any number of properties as possible replacements for your relinquished property as long as you end up purchasing at least 95% of the aggregate value of all properties identified.

About Spectrus Real Estate
Spectrus Real Estate is a leading provider of diversified investment real estate. What drives Spectrus’ success is its ability to offer only the highest-quality, institutional-grade property, qualified through stringent due diligence. With an array of individual buyer property opportunities, Spectrus has become a buyer’s leading option when it comes to accruing wealth through real estate ownership. To learn more visit www.spectrusrealestate.com

Spectrus Real Estate is a leading provider of diversified investment real estate in the 1031 exchange replacement market. Offering investment real estate individual buyer property opportunities in everything from income-producing properties to undeveloped land, Spectrus can help buyers seize the advantages of a 1031 exchange.

Did you know that it’s possible to defer capital gains taxes? Through a 1031 exchange you can save thousands of dollars in capital gains taxes by finding and closing on the right property, at the right time. And Spectrus can help you accomplish just that. The Spectrus Real Estate team helps you:

• Receive set monthly rental payments
• Receive 100% of the potential property appreciation
• Complete a quick and efficient closing with NO additional closing costs
• Quickly identify quality replacement properties (we always maintain a quality, diversified inventory)
• Land banking options

About Spectrus Real Estate
Spectrus Real Estate is a leading provider of diversified investment real estate. What drives Spectrus’ success is its ability to offer only the highest-quality, institutional-grade property, qualified through stringent due diligence. With an array of individual buyer property opportunities, Spectrus has become a buyer’s leading option when it comes to accruing wealth through real estate ownership. To learn more visit www.spectrusrealestate.com

The investment real estate land and development cycle generally has four stages, each with its unique risks, costs, and returns. Each stage has its own time frame, and each stage should be viewed as a separate purchase, even if a purchaser were to buy the raw land, entitle, and develop it into an income-producing asset. Stages will invariably overlap in many instances, but generally, these four points in time represent when value is added and/or realized.

Stage 1 - Raw Land
Stage 2- Land entitlement
Stage 3- Constructions/Development
Stage 4- Income-producing asset

About Spectrus Real Estate
Spectrus Real Estate is a leading provider of diversified investment real estate. What drives Spectrus’ success is its ability to offer only the highest-quality, institutional-grade property, qualified through stringent due diligence. With an array of individual buyer property opportunities, Spectrus has become a buyer’s leading option when it comes to accruing wealth through real estate ownership. To learn more visit www.spectrusrealestate.com

Spectrus Real Estate is a full-service investment real estate company.
Two entities comprise Spectrus' support system.

Spectrus Real Estate
* Corporate headquarters in Boise, Idaho
* Six regional offices across the United States
* Sales Executives in more than 40 of the country's top metropolitan areas

DBSI
* Acquisitions team
* Due Diligence team
* Asset and Property Management services
* Leasing department
* Legal department
* Finance department
* Escrow department
* Client Services department

About Spectrus Real Estate
Spectrus Real Estate is a leading provider of diversified investment real estate. What drives Spectrus’ success is its ability to offer only the highest-quality, institutional-grade property, qualified through stringent due diligence. With an array of individual buyer property opportunities, Spectrus has become a buyer’s leading option when it comes to accruing wealth through real estate ownership. To learn more visit www.spectrusrealestate.com

What is a 1031 exchange?

Under Internal Revenue Code (IRC) Section 1031, a real property owner can sell certain property and then reallocate the proceeds in ownership of like-kind property and defer the capital gains taxes. To qualify as a like-kind exchange, property exchanges must be done in accordance with the rules set forth in the tax code and in the treasury regulations. The 1031 exchange can offer significant tax advantages to real estate buyers.

Who should consider a 1031 exchange?

If you have real property that will net you a gain upon sale (generally property that has been substantially depreciated for tax purposes and/or has appreciated in fair market value), then you are exactly the person who should consider a 1031 exchange.

There are 5 tax classes of property:

1. Property used in taxpayer’s trade or business




2. Property held primarily for sale to customers




3. Property that is used as your principal residence




4. Property held for investment




5. Property used as a vacation home

Section 1031 applies to the first and fourth categories, and sometimes the fifth category. Business use is defined as, "To hold property for productive use in trade or business." Property retired from previous productive use in business can be qualifying property. Investment purpose is defined as real estate, even if unproductive, held by a non-dealer for future use; or the increment in value is held for investment and not primarily for sale. Investment is the passive holding of property, for more than a temporary period, with the expectation that it will appreciate. Property held for sale in the immediate future is not held for investment.

Why should you consider a 1031 exchange?

· Defer paying capital gains taxes. A properly structured exchange can provide real estate buyers with the opportunity to defer all or most of their capital gains taxes.

· Leverage.

· Upgrade or consolidate property.

· Diversify. Own multiple properties rather than just one.

· Relocation to a new area.

· Differences in regional growth or income potential.

· Change property types among commercial, retail, etc.

What are the general 1031 exchange rules?

The real property you sell and the real property you buy must both be held for productive use in a trade or business or for investment purposes, and must be like-kind.

The proceeds from the sale must go through the hands of a qualified intermediary and not through your hands or the hands of one of your agents, or else all the proceeds will become taxable.

All the cash proceeds from the original sale must be reallocated to the replacement property—any cash proceeds that you retain will be taxable.

The replacement property must be subject to an equal level or greater level of debt than the relinquished property or the buyer will either have to pay taxes on the amount of the decrease or have to put in additional cash funds to offset the lower level of debt in the replacement property.

Disclaimer – There are substantial risks associated with the federal income tax consequences of purchasing and owning real property, especially if the purchase is part of a tax-deferred exchange under section 1031 of the code. In addition, the income tax consequences of purchasing and owning real property are complex. Because the tax consequences are complex and certain of the tax consequences may differ depending on individual tax circumstances, each prospective purchaser must consult with and rely on his own independent tax advisor concerning the tax consequences of such a purchase and his individual situation.

About Spectrus Real Estate
Spectrus Real Estate is a leading provider of diversified investment real estate. What drives Spectrus’ success is its ability to offer only the highest-quality, institutional-grade property, qualified through stringent due diligence. With an array of individual buyer property opportunities, Spectrus has become a buyer’s leading option when it comes to accruing wealth through real estate ownership. To learn more visit www.spectrusrealestate.com