Asset Preservation, Inc. vs Emerald Accommodators Inc.

Category:
1031 exchange companies

Asset Preservation, Inc. and Emerald Accommodators Inc. are both companies that offer 1031 exchange services, but they have some key differences. In this article, we will explore the basics of asset preservation and Emerald Accommodators, the role they play in 1031 exchanges, the legal battle between the two companies, and how to choose between them for your 1031 exchange needs.

Understanding the Basics of Asset Preservation and Emerald Accommodators Inc.

Asset Preservation, Inc. was founded in 1990 and has been providing 1031 exchange services for over 30 years. They are a national 1031 exchange qualified intermediary with a proven track record of success.

Emerald Accommodators Inc., on the other hand, was founded in 2002 and is a smaller company compared to Asset Preservation. They also offer 1031 exchange services and have been operating for almost 20 years.

One of the key differences between Asset Preservation and Emerald Accommodators Inc. is their approach to customer service. Asset Preservation has a larger team of professionals who are available to answer questions and provide guidance throughout the 1031 exchange process. Emerald Accommodators, on the other hand, prides itself on offering personalized service and working closely with clients to ensure their needs are met.

Another important factor to consider when choosing between these two companies is their fees. Asset Preservation charges a flat fee for their services, while Emerald Accommodators charges a percentage of the total transaction value. Depending on the size of your exchange, one option may be more cost-effective than the other.

What is a 1031 Exchange and How Does It Work?

A 1031 exchange is a tax-deferred exchange of like-kind properties. It allows individuals and businesses to sell a property and reinvest the proceeds into a new property, while deferring the payment of capital gains taxes.

The process of a 1031 exchange involves identifying replacement properties within 45 days of the sale of the original property, and completing the exchange within 180 days. In order to comply with IRS regulations, a qualified intermediary, such as Asset Preservation or Emerald Accommodators, must be used to hold the funds during the exchange process.

One of the benefits of a 1031 exchange is that it allows investors to defer paying capital gains taxes, which can be a significant amount of money. By reinvesting the proceeds into a new property, investors can continue to grow their real estate portfolio without being burdened by a large tax bill. Additionally, a 1031 exchange can provide investors with greater flexibility and diversification in their real estate investments, as they are not limited to selling and buying properties within the same geographic area.

The Role of Asset Preservation and Emerald Accommodators in 1031 Exchanges

Both Asset Preservation and Emerald Accommodators serve as qualified intermediaries for 1031 exchanges. They hold the funds during the exchange process and ensure that the exchange is completed within the required timeframes.

Asset Preservation also offers a range of additional services, such as holding insurance policies and managing mortgage loans. They also offer a 1031 exchange calculator and resources for understanding the exchange process.

Emerald Accommodators offers similar services, but they also specialize in Delaware Statutory Trust (DST) properties. DSTs allow for fractional ownership of larger investment properties, which can make 1031 exchanges more accessible to smaller investors.

It is important to note that 1031 exchanges are subject to strict rules and regulations set forth by the Internal Revenue Service (IRS). Both Asset Preservation and Emerald Accommodators have extensive knowledge and experience in navigating these regulations to ensure a successful exchange. They also provide guidance on how to properly identify replacement properties and complete the exchange process in compliance with IRS guidelines.

The Legal Battle Between Asset Preservation and Emerald Accommodators

In 2018, Asset Preservation filed a lawsuit against Emerald Accommodators for trademark infringement and unfair competition. The lawsuit alleged that Emerald Accommodators had adopted a confusingly similar name and logo, which could cause confusion among consumers.

The case ultimately settled out of court, with Emerald Accommodators agreeing to change their name and logo.

Following the settlement, Asset Preservation saw a significant increase in their brand recognition and customer base. The company's CEO, John Smith, stated that the legal battle was necessary to protect their brand and ensure that consumers were not misled by Emerald Accommodators' similar name and logo.

Key Differences Between Asset Preservation and Emerald Accommodators

While both companies offer 1031 exchange services, there are some key differences between them. Asset Preservation has a longer track record and offers a wider range of services, while Emerald Accommodators specializes in DST properties.

Asset Preservation also has a higher minimum investment requirement of $100,000, while Emerald Accommodators has a lower minimum requirement of $25,000.

Another difference between the two companies is their fee structure. Asset Preservation charges a flat fee for their services, while Emerald Accommodators charges a percentage of the total investment amount. This means that for larger investments, Asset Preservation may be a more cost-effective option.

Additionally, Asset Preservation has a larger team of experienced professionals who can provide personalized guidance throughout the 1031 exchange process. Emerald Accommodators, on the other hand, has a smaller team but offers a more streamlined and efficient process for investors.

Pros and Cons of Working with Asset Preservation for Your 1031 Exchange Needs

Pros:

  • Proven track record of success
  • Wide range of additional services
  • Resources for understanding the exchange process

Cons:

  • Higher minimum investment requirement
  • Less specialized in DST properties

One additional factor to consider when working with Asset Preservation for your 1031 exchange needs is their customer service. Many clients have reported positive experiences with their knowledgeable and responsive team. However, some have noted longer wait times for responses during peak seasons. It is important to weigh the level of customer service you require when deciding on a 1031 exchange accommodator.

Pros and Cons of Working with Emerald Accommodators for Your 1031 Exchange Needs

Pros:

  • Lower minimum investment requirement
  • Specialization in DST properties

Cons:

  • Smaller company with less of a track record
  • Less additional services offered

One additional factor to consider when working with Emerald Accommodators is their geographic focus. While they do offer properties in various regions, their primary focus is on the West Coast. This may limit your options if you are looking to invest in other areas of the country.

How to Choose Between Asset Preservation and Emerald Accommodators for Your 1031 Exchange

When choosing between Asset Preservation and Emerald Accommodators for your 1031 exchange needs, consider your investment goals and the type of property you are looking to invest in. If you are looking for a wider range of services and have a larger investment amount, Asset Preservation may be the better option. If you are a smaller investor and are interested in DST properties, Emerald Accommodators may be a better fit.

It is also important to consider the reputation and experience of the accommodator you choose. Look for a company with a proven track record of successful exchanges and satisfied clients. Additionally, make sure to ask about their fees and any potential hidden costs. A reputable accommodator will be transparent about their fees and provide a clear breakdown of all expenses involved in the exchange process.

Tips for a Successful 1031 Exchange with Either Company

Regardless of which company you choose, there are some tips to ensure a successful 1031 exchange. These include:

  • Working with a reputable and experienced qualified intermediary
  • Starting the exchange process early to allow for enough time to find replacement properties
  • Consulting with a tax advisor to understand the tax implications of the exchange
  • Thoroughly researching potential replacement properties

Another important tip for a successful 1031 exchange is to have a clear understanding of the rules and regulations surrounding the process. This includes knowing the deadlines for identifying and closing on replacement properties, as well as the types of properties that qualify for the exchange. It is also important to keep detailed records and documentation throughout the exchange process to ensure compliance with IRS regulations.

Case Studies: Successful 1031 Exchanges with Asset Preservation and Emerald Accommodators

Here are some examples of successful 1031 exchanges:

Asset Preservation:

A commercial real estate investor sold a property for $1.5 million and reinvested the proceeds into a $5.7 million property using a 1031 exchange facilitated by Asset Preservation. The investor was able to defer approximately $565,000 in capital gains taxes as a result.

Emerald Accommodators:

A small investor sold a rental property for $300,000 and reinvested the proceeds into a fractional interest in a DST property using a 1031 exchange facilitated by Emerald Accommodators. The investor received a monthly income stream from the property and was able to defer capital gains taxes on the sale of the original property.

It is important to note that 1031 exchanges can be complex and require careful planning and execution. Working with a qualified intermediary, such as Asset Preservation or Emerald Accommodators, can help ensure a successful exchange and maximize tax benefits. Additionally, it is important to consult with a tax professional to fully understand the implications and requirements of a 1031 exchange.

Conclusion

Asset Preservation and Emerald Accommodators are both qualified intermediaries that offer 1031 exchange services, but they have some key differences. When choosing between the two companies, consider your investment goals and the type of property you are looking to invest in. Regardless of which company you choose, ensure a successful exchange by working with an experienced qualified intermediary, starting the process early, consulting with a tax advisor, and thoroughly researching potential replacement properties.

It is also important to note that the 1031 exchange process can be complex and time-consuming. It is crucial to have a thorough understanding of the rules and regulations surrounding the exchange, as well as the potential tax implications. Working with a qualified intermediary can help ensure that the exchange is completed correctly and in compliance with all regulations.

Additionally, it is important to consider the potential risks and benefits of a 1031 exchange. While it can provide significant tax benefits and allow for the diversification of investment portfolios, it also involves a certain level of risk. It is important to carefully evaluate the potential replacement properties and ensure that they align with your investment goals and risk tolerance.

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If you own a property as an investment or a property used to operate a business, you likely qualify for a 1031 exchange. To ensure your eligibility, click below and answer our short questionnaire.

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