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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: GraceZ who wrote (53605)	2/12/2006 5:13:57 PM
From: TimbaBear	Read Replies (1) of 110194

I know quite a few that are in the RE game, if you reinvest the cap gains with a 1031 exchange, you can defer income taxes indefinitely on those gains. In my experience, most people with large taxable speculative gains tend to stay in the game until they lose. I know some that are in the game as investors, several real estate agents, and many who are in the mortgage side of it (I used to be a mortgage loan originator in this area for many years). Few use 1031. Few hold long enough to take advantage of the personal residence exclusion.....at least if this is all they did, then they wouldn't meet the definition of "flipper". Given the run in property values over the last 4 years, given that those who have played it usually don't want IRS problems, and given that 2004 was pretty hot for the housing market flippers, I still believe a not insignificant portion of the supposed increase in personal tax collections is related to flippers' estimated payments. Only time will clarify I suppose. Timba

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