Most tax professionals assume joint filing is the default for married couples, but the tax code actually says the opposite. Jeremy Wells explores the surprising reality that married filing separately is technically the default status, requiring both spouses to elect joint filing under IRC Section 6013. He breaks down the key disadvantages of separate returns—from reduced credits to income limitations—while explaining legitimate scenarios where paying extra tax through separate filing can lead to better overall financial outcomes, particularly with student loan repayment strategies.

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Jeremy Wells breaks down the fundamentals of Section 1031 exchanges, explaining how real estate investors can defer capital gains taxes by swapping properties rather than selling and buying separately. He clarifies common misconceptions about these transactions, walks through the strict timing requirements including the 45-day identification and 180-day completion rules, and examines court cases that reveal when the IRS challenges whether replacement properties were truly intended for investment purposes. The discussion covers qualifying property types, disqualified persons, and the practical mechanics of using qualified intermediaries to facilitate these tax-advantaged exchanges.

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• (00:00) - Introduction to 1031 Exchanges
• (02:06) - Understanding the Basics of 1031 Exchanges
• (04:15) - Mechanics of a 1031 Exchange
• (08:22) - Qualifying Property for 1031 Exchanges
• (19:24) - Case Studies: Real-Life 1031 Exchange Scenarios
• (29:17) - Taxpayer's Genuine Effort to Rent Property
• (30:47) - Disqualified Persons in Section 1031 Exchanges
• (34:03) - Understanding Like-Kind Property
• (43:55) - Deferred Like-Kind Exchanges
• (51:48) - Reporting Like-Kind Exchanges on Form 8824
• (56:26) - Conclusion and Final Thoughts

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Jeremy dives deep into the critical red flags that should make tax professionals pump the brakes on S-corporation elections. From balance sheet debt ratios that could trigger unexpected taxable events to operating agreement provisions that can inadvertently terminate S-elections, this episode challenges the "default to S-corp" mentality that's become prevalent in tax advisory circles. Jeremy breaks down the specific scenarios where partnerships or sole proprietorships actually serve business owners better than the often-hyped S-corporation structure.

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This podcast is a production of the Earmark Media