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Tax Advantages of 1031 Exchanges

Two things in life are certain: death and taxes.

You cannot determine the time of your death, but sometimes you can determine when you  will pay taxes. A dollar not spent is a dollar earned. Internal Revenue Code § 1031 allows you defer paying taxes on investment/business property.   In an ordinary sale transaction, the property owner is taxed on any gain realized by the sale of the property.  In a 1031 exchange, however, you roll the gain from the sale of your “old” investment/business property into the purchase of your “new” investment/business property.  To defer all of your capital gains tax, you must buy a property equal or higher in value than the one you sold.  If you receive additional money or other property, then gain is recognized to the extent of such money and other (non-like-kind) property.

A Qualified Intermediary, an independent third-party, must be used to hold money during the 1031 Exchange.  The lawyers of Malone Law Group PS  are qualified to serve as intermediaries in 1031 Exchanges.  If you  have an interest in taking advantage of a 1031 tax-deferred exchange, contact Tom Malone.

Seattle Business Owners Alert: Criminal Background Checks Prohibited in Hiring Decisions; $15 Minimum Wage Ordinance

Seattle City Council recently enacted two ordinances that significantly impact Seattle Business Owners.

Chapter 14.17, entitled “Fair Chance Employment Ordinance” prohibits employers from failing to hire or promote an applicant/employee on the basis of criminal, conviction or arrest records, or criminal back ground checks.  Employers are prohibited from basing hiring decisions on background checks except when such information will have a negative impact on the employee’s or applicant’s fitness to perform the job, or will cause harm or injury to the employer or employer’s clients.  Employers are required to notify applicants or employees of any adverse employment decisions based on their criminal background record.

In addition, in 2014, Seattle City Council established a $15 per hour minimum wage for all persons employed within the City of Seattle.  The wage increases will be phased in over a three-to-seven year time frame starting in 2015.

If you have questions or concerns about how the new legislation may impact your business, please contact Tom Malone at Malone Law Group PS, 206.527.0333.