Please click on each tab for information

The information contained in this web site is believed to be reliable and while every effort is made to assure that the information is as accurate as possible, the owner of this site  disclaims any implied warranty or representation about it's accuracy, completeness or appropriateness for any particular purpose. Online readers should not act upon this information without seeking professional counsel.

UPDATES AND INFORMATIONS FLORIDA REAL ESTATE

IRS: 1031 EXCHANGES ON VACATION HOMES

The Internal Revenue Service recently issued Revenue Procedure 2008-16, which spells out how vacation properties can qualify for 1031 exchanges. The guidance aims to clear up the debate over vacation homes, and whether they're an investment or personal use properties. To qualify for a 1031 exchange, the IRS says that the taxpayers must hold the property for 24 months. The holding period is broken further into 12-month blocks, and during each, the property must be rented at the fair market rate for no less than 14 days. Additionally, the owner can use the property for 14 days or 10 percent of the days rented, whichever is greater, plus devote a "reasonable" number of days to maintenance. Because it is a safe harbor ruling, experts say failing to comply with all the rules does not mean the exchange will be denied or an audit will automatically occur. However, they underscore the importance of keeping good records of the property's rental history and the dates the property was occupied by the owner for maintenance.

03/0/08

Why you need Title Insurance

When purchasing a home, you want to be secure in the fact that, when the Seller transfers title to you, the property is safely yours.

Hidden title defects may fail to be uncovered by the most professional title search. These hidden defects might consist of forged deeds, transfer of title by someone under age, a married individual transferring title with out his or her spouse, and numerous other fraudulent acts.

Title Insurance will protect your investment.

Title Insurance is a policy of protection against loss arising from a claim against the ownership of your property.

Unlike Medical Insurance and Homeowner's Insurance which is either a monthly or yearly fee, Title Insurance is a one time charge to protect the title to your property.

Del Prado Realty, LLC works hand in hand with Gulf Breeze Title Insurance Agency, Inc.

Here you can find some information why you will need a lawyer

The information contained in this web site is believed to be reliable and while every effort is made to assure that the information is as accurate as possible, the owner of this site  disclaims any implied warranty or representation about it's accuracy, completeness or appropriateness for any particular purpose. Online readers should not act upon this information without seeking professional counsel.

What is ‘probate’?

Probate is the process that transfers legal title of property from the estate of the person who has died (the "decedent") to his or her proper beneficiaries.

The term "probate" refers to a "proving" of the existence of a valid Will, or determining and "proving" who one's legal heirs are if there is no Will. Since the deceased can't take it with him, probate is the process used to determine who gets his or her property

Why is probate necessary?

The primary function of probate is transferring title of the decedent’s property to his heirs and/or beneficiaries. If there is no property to transfer, there is usually no need for probate.

Another function of probate is to provide for the collection of any taxes due by reason of the deceased's death or on the transfer of his or her property.

The probate process also provides a mechanism for payment of outstanding debts and taxes of the estate, for setting a deadline for creditors to file claims (thus foreclosing any old or unpaid creditors from haunting heirs or beneficiaries) and for the distribution of the remainder of the estate's property to ones' rightful heirs.

What is summary administration?

Summary administration is a procedure available to speed up the closing of an estate when further

court supervision of the administration of the estate is no longer necessary. It may be used for estates

with a will (testate) or without a will (intestate). The administration of the estate will be completed

without further court supervision in accordance with the deceased's will and applicable law.

When may a summary administration be filed?

A person administering an estate may file a motion for summary administration to close an estate not

less than 6 months after his or her appointment as administrator or executor of the estate. The estate of

the deceased must have been open for at least 6 months.

The Foreign Investment in Property Tax Act (FIRPTA)

Seller agrees to comply with IRS reporting requirements. If applicable, Seller agrees to complete, sign, and deliver to Escrow Company (Title Insurance Co. or Attorney) a certificate indicating whether Seller is a foreign person or a non-resident alien pursuant to the Foreign Investment in Real Property Tax Act (FIRPTA). Buyer acknowledges that if the Seller is a foreign person, the Buyer must withhold a tax equal to 10% of the purchase price, unless an exemption applies.

The Foreign Investment in Real Property Tax Act (FIRPTA), was enacted in 1980 and provides, that if the Seller of real property is a foreign person, the Buyer must withhold a tax equal to 10% of the gross purchase price, unless an exemption applies. 26 U.S.C.A. § 1445(a). A foreign person is a nonresident alien individual; a foreign corporation not treated as a domestic corporation; or a foreign partnership, trust or estate. A resident alien is not considered a foreign person under FIRPTA.

There are numerous exemptions to the FIRPTA requirements. The most common exemption is when the seller furnishes a non-foreign affidavit stating under penalty of perjury that the seller is not a foreign person. 26 U.S.C.A. §1445(b)(2). Another exemption is a transaction involving the transfer of a property acquired for use as the buyer’s residence and the amount realized (purchase price) does not exceed $300,000. 26 U.S.C.A. §1445(b)(5).

Although FIRPTA generally provides that 10% of the purchase price must be withheld, the amount withheld should not exceed the seller’s maximum tax liability. 26 U.S.C.A. §1445(c).

Any necessary withholding should be accomplished by requiring the escrow agent to withhold the required funds. The escrow company should be instructed to send the funds to the IRS at close of escrow. Additional information regarding this issue may be obtained in IRS Publication 515.

Department of the Treasury/Internal Revenue Service — Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Corporations

The foregoing is for informational purposes only and is not intended as definitive legal or tax advice. Transmission of this information is not intended to create, and receipt does not constitute, an attorney-client relationship. You should not act upon this information without seeking independent legal counsel. If you desire legal advice, tax or other professional advice, please contact your attorney, tax advisor or other professional consultant.