Tenant-in-Common Exchanges

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Overview of TIC Investments and Exchanges

A Tenant-in-Common (TIC) Exchange leverages Section 1031 of the Internal Revenue Service Code, allowing real estate investors to exchange current holdings for new ones, while deferring the capital gains taxes that ordinarily would be due.

Tenant in Common Ownership — TIC investments are structured to defer capital gains taxes in accordance with 1031 exchange requirements. As a Tenant-in-Common (TIC) owner you own an undivided interest in a property along with other co-owners. Thus, a TIC owner may own a share of the entire apartment complex, corporate office building, shopping center or industrial warehouse rather than a specific tenant space.

Why choose a TIC Investment?

TIC 1031 tax deferred exchanges provide more flexibility than a traditional 1031 exchange to the real estate owner through: flexible investment size, timing, additional diversification, and institutional real estate, as follows:

	The ability to have more investment options available during the 45-day identification period.
	Owners receive current monthly cash flow, generally averaging 7-8% per annum, in addition to capital appreciation, depending on the individual investment property chosen.
	The TIC arrangement is structured so the buyer can benefit from the IRS Revenue Procedure which stipulates the rules that TICs must follow to allow 1031 tax-deferred treatment (Rev-Proc 2002-22).
	Eliminates the headaches of direct property management — you are buying professionally-managed investment property.
	Allows the investor to acquire investment-grade property of significantly higher quality than the value of their sold property.
	The investments are flexibly-sized in percentage ownership units, so can easily match the amount you require for your exchange.
	Allows for all tax advantages and appreciation of real estate ownership.
	Pre-arranged, assumable, non-recourse, fixed-rate financing and easy approval. Zero to 70% leverage available.
	The complex timing requirements of the 1031 exchange are designed into the TIC, so it's not a problem to satisfy the 45-day identification period or the 180-day exchange and closing period.

This is a brief summary of the concepts and principles involved in TIC/1031 Real Estate Exchanges; there is much more that we could cover in a personal consultation. I'd welcome the opportunity to work with you on a specific plan to avoid or reduce capital gains taxes on your current investments. Call or email me directly, or submit the form on the "Find an Advisor" page.

Mr. Birnbaum is registered in all the New England States (MA, VT, NH, ME, CT, RI), Florida (FL), Colorado (CO) and California (CA).

Tenant-in-Common and 1031 Real Estate Exchange investments are limited to accredited investors. An accredited investor is one who either:

	has a net worth of at least $1,000,000 or
	has income of at least $200,000 ($300,000 combined income if married) in each of the last two tax years with expectations to make that much in the current year.

As with any real estate investment, there are various risks including, but not limited to: loss of principal, variations in occupancy which may negatively impact cash flow, illiquidity, and limits on management control of the property.

Securities are offered through: Advisory Group Equity Services, Ltd., Member FINRA/SIPC, 161 Ash Street, Suite D, Reading, MA 01867 (781) 942-5070 . Investment advisory services are offered through Trust Advisory Group, Ltd., a Registered Investment Advisor.

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