Thousands of Dollars in Benefit: a Quick Case to Consider

Situation: You want to sell $30,000 worth of pipe (fully depreciated for tax purposes) and replace it with new pipe.

Problem: The blended tax rate in your state is approximately 40%. When you sell your pipe, you immediately incur a tax liability on the proceeds of the sale and you now owe the IRS $12,000.

Solution: Instead, sell your pipe through Network International and work with Accruit to structure the sale as a 1031 exchange. You sell the pipe for $30,000 and then have 180 days to purchase replacement assets; you apply the $30,000 in sale proceeds to the new assets and defer the $12,000 tax liability indefinitely as long as you continued selling and reinvesting in like-kind assets.

Without 1031 Exchange: Pay the IRS $12,000.

With 1031 Exchange: Keep that $12,000 at work in your business.

Key Benefits of Alliance:

• One-stop access to a variety of innovative and quality services
• Significant cash flow benefits
• Significantly enhanced asset management capabilities
• Ready access and seamless integration for Network and Accruit clients
• Decreased carrying costs associated with idle assets
• Defer recognition of gains associated with selling common equipment, reinvest those funds back into the business