It’s been long since we spoke but i keep reading the Lit you send out and it’s always very informative, learn new things every time.
I was just wondering if you’ve ever done a double close/back to back close here in Mass, AND
(a) What was the overall experience ? How long did it take ? Was it complicated ?
(b) Can you recommend a good attorney or firm that is based in MA and is good at handling these types of deals?
(c) What are the tax implications of doing a double closing? Since you’re buying and selling property for profit on the same day, do you get charged capital gains tax at a higher rate ?
(d) Lastly, since you’ll own the property for a couple of minutes during a double close, is your name (or entity name) ever recorded as an owner?
Wow – you asked a loaded one there! My very FIRST piece of advice to you is to get a good investor-friendly attorney in MA. They handle as much as they can, and are up to date with the continuously changing guidelines and laws on investor transactions. I use Matt Desrochers out of Wilmington, he is also a corporate sponsor of Boston AREIA. Primarily a bankruptcy attorney, he is very knowledgeable on running the deal.
I’ll answer these as smoothly as possible – the most IMPORTANT thing you can do is have a good team backing you. I no longer CARE about the tax implications, as I send all transactions to my team (consisting of CPA, attorney, lender, etc) and they come back and have it figured out for me. That doesn’t mean I don’t still enjoy putting together and being creative.
I’ve done a few – it’s VERY complicated. You’re balancing a lot – buyer & seller needs, timing of moving companies on both parties (if applicable), and if the C buyer is not using cash, you’re at the mercy of seasoning guidelines and potential title insurance issues with the lender for your C buyer.
How long does it take? Well… a day. If you can do it. You need a GOOD TEAM in place to do it.
As far as tax implications, check with your CPA!! LOTS of red tape to get through on here. All I’ll say… if you have the right CPA, they can let you know the risks, and can help mitigate the damage on your tax forms.
Lastly, yes, you’re on the title. Or your entity. (Hint, hint).