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Can I Purchase Real Estate With Stock?
Old 07-04-2022, 04:57 PM   #1
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Can I Purchase Real Estate With Stock?

Anyone know if I can purchase real estate via something like an in-kind stock/equity transfer? I know that I can sell the stock (and pay taxes) but I want to avoid the tax hit and just purchase land/home as an in-kind stock transfer.

BTW - I would be transferring stock/equities from a taxable brokerage account.
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Old 07-04-2022, 05:21 PM   #2
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I think they have that covered by way of "barters and trades"
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Old 07-04-2022, 10:17 PM   #3
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Originally Posted by RetiredAt49 View Post
Anyone know if I can purchase real estate via something like an in-kind stock/equity transfer? I know that I can sell the stock (and pay taxes) but I want to avoid the tax hit and just purchase land/home as an in-kind stock transfer.

BTW - I would be transferring stock/equities from a taxable brokerage account.
Otherwise known as tax fraud.
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Old 07-04-2022, 10:25 PM   #4
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Otherwise known as tax fraud.

If I can purchase a home/land with money, why couldn’t I purchase a home with stock? Is it illegal? I assume the home owner would have to agree to receiving it.
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Old 07-04-2022, 10:27 PM   #5
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If I can purchase a home/land with money, why couldn’t I purchase a home with stock? Is it illegal? I assume the home owner would have to agree to receiving it.
Because you are evading the capital gains taxes you owe.

Tax fraud. Illegal.
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Old 07-05-2022, 03:25 AM   #6
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If you transfer stock to another person, they get your basis. Who is going to accept that?

If this wasn't the case, people would be swapping stocks to lose the cap gains. You think that would be allowed?
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Old 07-05-2022, 03:43 PM   #7
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You could trade stocks for house if seller was willing but you would still owe cap gains.
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Old 07-05-2022, 04:25 PM   #8
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I used margin to buy a house for my DD and SIL, at very good rates. I opened an IBKR account, let it season for a month, then borrowed on margin $243,000 at 1.52%. My margin percentage was a little bit under 40%, but I got advice from Pete at MMM that I might want to get a Heloc to pay that percentage down, in case the market dropped. So I did that, went to banker , Saying I'd like to get a HELOC, I don't have a job I have no regular income, but I did get the HELOC with just showing the statements from my Vangard accounts, IRAs and Roths, I may have shown my IBKR account, but I don't think so, I find there webpages hard to decipher, but not so hard that I couldn't figure out how get money on margin. Nice surprise, the Bank HELOC teaser was 0.99% for 6 months then jumped to 3.99%. So, my blended interest rate was 1.26%. Now, dad's not a dummy, this was a fixer upper house, so I gave the kids a mortgage at 4% the first year and as a get your a$$ in gear, 6% for the second year. They fixed the house and mortgaged it in 10 months, I got my money and paid off all the loans.

I'm sure rates have risen a little since I margined in July of 2021 and got my Heloc in Sept 2021, The mortgage I held was paid off May 13, 2022

Here is where I got the idea and more details about it. https://www.mrmoneymustache.com/2021...n-ibkr-review/


Just looked at the IBKR site, Rate have exploded, 3.58% for $100k to $1M. https://www.interactivebrokers.com/e...rgin-rates.php
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Old 07-05-2022, 04:36 PM   #9
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There are 1031 in-kind exchanges that defer any capital gains. Unfortunately exchange of stock for real estate is not permitted.

Quote:
Real property and personal property can both qualify as exchange properties under Section 1031;
but real property can never be like-kind to personal property. In personal property exchanges, the
rules pertaining to what qualifies as like-kind are more restrictive than the rules pertaining to real
property. As an example, cars are not like-kind to trucks.
Finally, certain types of property are specifically excluded from Section 1031 treatment. Section
1031 does not apply to exchanges of:
• Inventory or stock in trade
• Stocks, bonds, or notes
• Other securities or debt
• Partnership interests
• Certificates of trust
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Old 07-05-2022, 04:37 PM   #10
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I used margin to buy a house for my DD and SIL, at very good rates. I opened an IBKR account, let it season for a month, then borrowed on margin $243,000 at 1.52%. My margin percentage was a little bit under 40%, but I got advice from Pete at MMM that I might want to get a Heloc to pay that percentage down, in case the market dropped. So I did that, went to banker , Saying I'd like to get a HELOC, I don't have a job I have no regular income, but I did get the HELOC with just showing the statements from my Vangard accounts, IRAs and Roths, I may have shown my IBKR account, but I don't think so, I find there webpages hard to decipher, but not so hard that I couldn't figure out how get money on margin. Nice surprise, the Bank HELOC teaser was 0.99% for 6 months then jumped to 3.99%. So, my blended interest rate was 1.26%. Now, dad's not a dummy, this was a fixer upper house, so I gave the kids a mortgage at 4% the first year and as a get your a$$ in gear, 6% for the second year. They fixed the house and mortgaged it in 10 months, I got my money and paid off all the loans.

I'm sure rates have risen a little since I margined in July of 2021 and got my Heloc in Sept 2021, The mortgage I held was paid off May 13, 2022

Here is where I got the idea and more details about it. https://www.mrmoneymustache.com/2021...n-ibkr-review/


Just looked at the IBKR site, Rate have exploded, 3.58% for $100k to $1M. https://www.interactivebrokers.com/e...rgin-rates.php
Yeah, your timing was brilliant. Rates have exploded and stocks have tanked. You might've been close to margin calls had you not made the slick maneuver into the HELOC and the kids not come through with their own mortgage. Congrats.
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Old 07-05-2022, 04:53 PM   #11
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Originally Posted by Time2 View Post
I used margin to buy a house for my DD and SIL, at very good rates. I opened an IBKR account, let it season for a month, then borrowed on margin $243,000 at 1.52%. My margin percentage was a little bit under 40%, but I got advice from Pete at MMM that I might want to get a Heloc to pay that percentage down, in case the market dropped. So I did that, went to banker , Saying I'd like to get a HELOC, I don't have a job I have no regular income, but I did get the HELOC with just showing the statements from my Vangard accounts, IRAs and Roths, I may have shown my IBKR account, but I don't think so, I find there webpages hard to decipher, but not so hard that I couldn't figure out how get money on margin. Nice surprise, the Bank HELOC teaser was 0.99% for 6 months then jumped to 3.99%. So, my blended interest rate was 1.26%. Now, dad's not a dummy, this was a fixer upper house, so I gave the kids a mortgage at 4% the first year and as a get your a$$ in gear, 6% for the second year. They fixed the house and mortgaged it in 10 months, I got my money and paid off all the loans.

I'm sure rates have risen a little since I margined in July of 2021 and got my Heloc in Sept 2021, The mortgage I held was paid off May 13, 2022

Here is where I got the idea and more details about it. https://www.mrmoneymustache.com/2021...n-ibkr-review/


Just looked at the IBKR site, Rate have exploded, 3.58% for $100k to $1M. https://www.interactivebrokers.com/e...rgin-rates.php

I have to say, very well done!
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Old 07-05-2022, 06:09 PM   #12
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Yeah, your timing was brilliant. Rates have exploded and stocks have tanked. You might've been close to margin calls had you not made the slick maneuver into the HELOC and the kids not come through with their own mortgage. Congrats.

Ya, I think the real push for the new mortgage was, they saw rates started to rise, they locked when a 30yr was 4.50% and a 15yr was 3.25%, they went with the 15yr, Dad told them a 15yr might be in their best interest, a little before crunch time and it worked out that way. I'm very happy for they way it worked out, it was a HUD Repo Fixer upper on the water with a short boat ride to the Gulf of Mexico. They are enthusiastic boaters/fisherman.
They were not the first bid to be excepted, but the first one fell through so they got another chance. It was a 6 month ordeal with the mortgage and closing company, through no fault of their own. Part way through the closing company merged and stopped all closing until everything was meshed, then they had trouble getting a manager for the office. I had early notice of the problems, so I prepared money wise just in case. They ended having to get two appraisals because of time run outs, luckily the second was $40,000 higher than the first, the Bradenton market was hot.
But when things were delayed, I stepped in and paid for the property. I'm happy because the kids now have a $252,000 mortgage that qualified on her husbands income only, now she graduated and has the income of a starting dentist, so, I'm afraid they/she could get themselves into an unneeded $500k or $600k house. But they now have their dream house on the water. Ya, happy daddy!
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