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Tenants In Common Explained

A tenants in common is an investment in a single large commercial commercial real estate by multiple real estate investors, not as limited partners, but as individual real estate investors. Each real estate investor receives an individual deed at closing for his or her undivided percentage interest in the entire commercial real estate. A tenants in common exchange qualifies as a 1031 exchange according the internal revenue code. The theory behind internal revenue code is that when a real estate investor has reinvested the sale proceeds into another commercial real estate, the economic gain has not been realized in a way that generates funds to pay any tax. Therefore, it would be unfair to force the taxpayer to pay tax on a paper gain. Tenants In Common exchanges offer this and many more benefits to investing.

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