Contact Steve! Home 760-834-8745 Mobile 760-636-6273		1031 Exchange with International Real Estate A Secret to Profitable Property Investing Abroad Derek Hadge Taxes are no fun...except a little when you can beat them...or at least defer them. If an American buys a piece of real estate in another country...then eventually sells it for a profit...he owes capital gains taxes both in the U.S. and (maybe) in the jurisdiction where the property resides. Here's a way to defer the U.S. part of that capital gains burden: like-kind exchange it. You may have heard of this strategy with regards to U.S. assets, but most people don't realize you can put it to work for you offshore, too. Buy a home in Mexico, sell it for 100% gain, then put the sales proceeds into a condo or a beach-front lot in Mexico. Do that within 180 days of the sale, and you owe no capital gains tax to Uncle Sam. It's got to be offshore proceeds into offshore proceeds. You can't like-kind exchange the profits from the sale of an apartment in the US for the purchase of an apartment in Mexico...and once the money has been invested in an apartment in Mexico, to continue to take advantage of the like-kind exchange loophole, you've got to keep it outside the States (though not in Mexico and not necessarily in an apartment...but, importantly, in an investment, not a residence). Restrictions, of course, apply. And I'm no expert.
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