For listing agents and real estate brokers
Your seller won't list because of the tax bill.
An owner sitting on a rental they have held for thirty years often does not stay a landlord because they enjoy it. They stay because the combined federal and California tax on the gain is a number they will not write a check for. A 1031 exchange may defer that tax — and replacement property does not have to be another building they manage.
- No referral fees. We cannot pay them and we do not pretend otherwise.
- Toni calls you, not your client. You decide what your client hears and when.
- Registered in the securities industry since 1996. Check Toni on FINRA BrokerCheck (CRD 2729672)
Have a seller stuck on the tax?
Tell us what you are looking at. Toni will call you. No client name required, no cost, no obligation.
This page is educational and is not tax, legal, or investment advice. It is written for real estate professionals, not as a recommendation to any investor. Your client should consult their own CPA and attorney.
Key takeaways
- A long-held rental can carry a combined federal and California tax bill on sale that an owner is simply unwilling to write a check for, and that is a listing that never comes to market.
- A 1031 exchange may defer the tax on investment or business-use real property if the deadlines are met and the seller never takes receipt of the proceeds. It defers tax; it does not eliminate it.
- An owner who does not want to buy and manage another building is not out of options: replacement property can be a passive interest, including a Delaware Statutory Trust interest for an accredited investor. DST interests are speculative and illiquid.
- The one mistake that cannot be fixed after the fact is closing without a qualified intermediary in place. Once the seller receives the money, the exchange is gone.
- We do not pay referral fees or share commissions with anyone who is not a registered representative, and we are not real estate brokers. The real estate side of the transaction stays yours.
The listing that never comes to market
You have had this conversation. The property is worth four times what they paid, the rents are below market, the roof is a problem, and the owner is tired. Then you get to what they would owe on the gain — federal long-term capital gains tax at rates up to 20%, the 3.8% net investment income tax for higher earners, depreciation recapture at up to 25%, and California income tax at a top rate of 13.3% — and the conversation stops.
They are not refusing to sell. They are refusing to pay the tax on selling.
Those are different problems, and only one of them has anything to do with price.
Section 1031 of the Internal Revenue Code allows the gain on investment or business-use real property to be deferred when the proceeds are reinvested in like-kind real property, provided the deadlines are met and the seller never takes receipt of the money. It is a deferral, not forgiveness: the deferred gain carries into the replacement property and becomes payable on a later taxable sale. Nothing here is assured, and an unfavorable ruling on a particular exchange can disallow the deferral and make the tax immediately due.
What we do not do
The reason agents do not make this call is not that they have never heard of a 1031 exchange. It is that handing a client to someone in the securities business feels like handing over the client. So here is the short list of things that are not on the table.
We do not pay referral fees
Compensation for securities business cannot be paid to a person who is not registered to receive it. So there is no finder's fee here, no commission split, and no gift card. If someone in this business has offered you one, that offer tells you something about how they operate.
We do not call your client first
Send us the situation and Toni calls you. You decide whether and how your client hears about it, and you stay on the call when they do. We are not real estate brokers and we do not compete for your listing.
We do not promise your client a result
No one can promise that a deferral will hold, that replacement property will perform, or that distributions will be paid. Any decision is the owner's, made with their own CPA and attorney, and they can lose some or all of what they invest.
We do not show offerings on this website
Specific DST offerings are private placements. They are not advertised, and they cannot be shown to a visitor whose accredited status has not been verified. If a competing site is showing you a list of properties with projected returns, that is worth noticing.
The deadline you cannot fix later
A qualified intermediary must be engaged before the sale closes, and the proceeds must go to the intermediary rather than to your seller. If your seller receives the money, the exchange is over and no amount of paperwork afterward brings it back. From the closing of the sale there are then 45 days to identify replacement property in writing and 180 days — or the due date of that year's tax return, whichever comes first — to close on it. Miss either and the gain is recognized.
What a qualified intermediary does → The 45 and 180 day deadlines →
When it fits, and when it does not
The fastest way to be useful to you is to tell you which of your sellers this is not for, so you do not spend a conversation on it.
Worth a call
- Investment or business-use real property — a rental, land held for investment, a small commercial building.
- An owner who would sell at the right number but balks at the tax, not one who needs the cash in hand.
- A sale that has not closed yet, or is in escrow with a qualified intermediary already engaged.
- An owner willing to talk to their own CPA before deciding anything.
Not a 1031
- A primary residence. Section 1031 does not apply, though a different exclusion may.
Selling a primary residence → - An owner who wants the proceeds in cash. An exchange moves the money into replacement property; it does not hand it over.
- A sale that has already closed with the proceeds paid to the seller. The exchange window is gone, and other strategies have their own deadlines.
Other capital gains strategies → - A non-accredited owner, for the DST route specifically. A direct purchase of replacement property has no such limit.
What accredited means →
How it works
Send the situation
Property type, roughly what the gain looks like, and where you are in the timeline. No client name needed, and no obligation.
Toni calls you
Not your client. Toni tells you plainly whether there is a path here and what the deadlines would be, including when the answer is no.
You bring it to your client, if you want to
If it is worth raising, Toni will join a call with you, your client and their CPA. The listing and the real estate commission are yours.
Who you will talk to
The bottom line
An owner who will not sell because of the tax is a listing sitting in your database doing nothing. A 1031 exchange may defer that tax if the deadlines are met and a qualified intermediary is in place before closing, and replacement property can be passive rather than another building to manage. There is no referral fee in it for you, and there is no promise of any outcome for your client. What there is, is a call that tells you whether the deal is alive — and it costs nothing to find out.
Rather talk first? Book a call with Toni.
Questions agents ask
Do you pay referral fees to real estate agents?
No. Compensation for securities business can only be paid to a person registered to receive it, so no referral fee, finder's fee or commission split is available to an unregistered real estate agent. What is available is a conversation that may turn an owner who will not sell into an owner who will, which is a listing you would otherwise not have.
Will you try to take over my client?
No. Toni calls you, not your client, and if the subject is worth raising with the owner, you stay on the call. We are not real estate brokers and have no interest in the listing side of the transaction.
What happens to my commission?
The real estate side of the transaction, including your commission, is between you, your brokerage and your client. We are not a party to it and we do not touch it.
What is the one thing that kills an exchange?
The seller taking receipt of the sale proceeds. A qualified intermediary has to be engaged before the sale closes, and the money has to go to the intermediary rather than to the seller. After that it cannot be undone. The other hard limits are the deadlines: 45 days from the closing of the sale to identify replacement property in writing, and closing by the earlier of 180 days or the due date of that year's tax return.
My client doesn't want to be a landlord again. Is an exchange still possible?
Replacement property does not have to be something they manage. Delaware Statutory Trust interests are one passive option, and are available only to accredited investors by private placement memorandum. They are speculative and illiquid, distributions are not guaranteed, fees reduce returns, and an investor can lose some or all of the investment. Whether any of it is suitable depends on the individual owner.
Is there a charge for the call?
No. There is no charge to you or to your client for the conversation, and no obligation.
For educational purposes only. Nothing on this page is tax, legal or investment advice, an offer to sell or a solicitation of an offer to buy any security, or a recommendation to any investor. No specific outcome, tax deferral or tax saving is promised. A 1031 exchange is subject to strict requirements and deadlines, tax rules change, and results depend on individual circumstances; a failed exchange results in the gain being recognized. All real estate investments can lose value, and all investments carry the risk of loss of some or all of the principal invested. Your client should consult their own CPA and attorney before acting. DST interests are offered only by private placement memorandum to accredited investors. They are speculative and illiquid, distributions are not guaranteed, fees reduce returns, and investors can lose some or all of their investment.