Middle-class taxpayers who sell their first investment property are shocked when they find that a major portion of their gain on the sale is due on the alternative minimum tax.That's because most of them don't bother consulting with their accountant ahead of time, according to Stephen Wayner, vice president of Miami-based Bayview Financial Services.
"They don't know that they can defer gain with a Code Section 1031 exchange, and later change their new property from an investment property to a residence," he said. "But it's too late once they've closed on the original investment property."
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