- 1031 Exchanges
- Tenants-In-Common
- Exchange Details & Requirements
- Real Estate Professional
Dual Registration Program - Tax Professionals, Legal Advisors & Northland Securities1031
- About Us
- The Tax Deferred Exchange
- How to Initiate an Exchange
- 1031 Exchange Requirements
- Do's & Don'ts of 1031 Exchange Planning
- Can Your Tax Professional or Legal Advisor Be Your Qualified Intermediary?
- Exchange Terminology
- Like-Kind Property
- 1031 Qualified Property
- Delayed Exchange Deadlines
- Tenant-In-Common Interests
- Master Lease-Tenants-In-Common
- Non-Tax Reasons to Exchange
- Role & Selection of a Qualified Intermediary
- Role of a Tax Professional or
Legal Advisors - Disqualified Parties
- Tenants-in-Common Research &
Due Diligence Reports - Exchange Language
Master Lease Tenants-In-Common
A Master Lease Tenants-In-Common (TIC) property is a large institutional quality property owned by up to 35 accredited investors and leased to a management company as a single tenant. At closing, a TIC owner receives an individual deed for his or her undivided fractional interest in the entire Tenants-In-Common property.
In exchange for specified lease payments to Tenants-In-Common owners, the master lessee is responsible for all management, subleasing, operations, maintenance and repairs of the TIC property. Lease payments to TIC owners are on a triple net basis with the master lessee responsible for all expenses associated with the property including real estate taxes, assessments and insurance.
Master Lease: Tenants-In-Common Advantages
- Defer capital gains taxes
- Constistent monthly cash flow
- Diversify or consolidate properties
- Elimate management responsibilites
- New depreciation schedule
- Appreciation pontential of an institutional quality property
Master Lease: Tenants-In-Common Disadvantages
- Lack of liquidity and no secondary market
- Fees and expenses that may outweigh any potential tax benefits
- May not qualify under IRS procedure 2002-02 as a replacement property
- Concentration of credit risk in Master Lessee
- Additional fees to Master Lessee may be charged
(Predetermined and consistent cash flow is based upon the financial strength of the master lessee and may result in additional fees or expenses.)
Tax professionals, legal advisors and qualified intermediaries should be consulted to determine if a Master Lease Tenants-In-Common property investment qualifies for “Safe Harbor” provisions. Northland Securities does not provide tax or legal advice. Master Lease Tenants-In-Common investments available through Northland Securities are offered by official offering memorandum to eligible accredited investors. For additional information regarding a Master Lease 1031 Tenants-In-Common, please contact Northland Securities1031.