I sold a client a building last month. I now have a buyer interested in purchasing it for 25% more than my client paid. Sellers reservation is that he has not met the IRS hold period of 12 to 18mo to complete and exchange.
I know tons of people that have performed exchanges with less than a 1 year hold. Per the sellers accommodator, who is very well respected, those folks exchanging under 12mo hold period may one day face a monster tax bill.
Any thoughts on hold period? I've done some research, not a ton, and most hold periods I'm reading about are referencing Owner Occ homes that become NOO, and NOO homes that be Owner Occ.
I've read several other sites. It comes down to intent. Did the buyer, now seller intent to own for investment instead of profit. Considering we have emails with several potential credit tenants and an architect drawing up a site plan for these tenants, I think it would be easy to present the case that there was clear long term intent.
There is no hard and fast number.
This is correct.
What is the buyers motivation for this purchase? Are they under the gun to close on this?
Maybe they can go hard on deposit and extend the closing for a year if they want the deal that bad to justify paying 25% more than the seller. It's a tall order but just an idea.
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