Category: Real Estate

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Real Estate

Selling Investment Real Estate? A 1031 Exchange Defers the Tax — But Only for Real Property Now

By Lei Jiang, Esq., Lei Jiang LLC.

If you sell investment or business real property and reinvest in similar real property, a 1031 exchange can defer the capital gains tax. It covers real property only — equipment, vehicles, and artwork do not qualify (I.R.C. § 1031(a)(1)). But two strict deadlines decide whether it works at all.

First, you must identify your replacement property within 45 days after you sell the old property. Second, you must complete the purchase within 180 days after the sale, or by the due date (with extensions) of your tax return for the year of the sale, whichever comes first (I.R.C. § 1031(a)(3)). For a sale late in the year, you may need to extend your return to keep the full 180 days. Miss either deadline and the exchange fails — the gain becomes taxable. There is no extension for a slow closing, and a “parking” arrangement, where an intermediary holds property for you, does not stretch the 180 days. You may identify up to three replacement properties regardless of value, or more if their combined value stays within 200% of what you sold.

One practical point: set up the exchange before you close the sale. The sale proceeds must go through a qualified intermediary — if the money touches your hands first, the exchange is disqualified. And the like-kind test for real estate is broad: a rental house can be exchanged for commercial land, for example. Line up the intermediary and your replacement-property search before closing, and put both deadlines on the calendar the day you sell.

The practical takeaway: 1031 still defers tax on real estate swaps, but only real property qualifies, and the 45-day and 180-day clocks start running the day you sell.

Questions? Contact us at info@leijianglaw.com or (440) 835-2271, or book a free 15-minute call: https://calendly.com/leijianglaw-info/15-minute-consultation

This article is general information, not legal advice for your situation.

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Real Estate

Your Commercial Tenant Stopped Paying Rent — What Can You Actually Do in Ohio?

By Lei Jiang, Esq., Lei Jiang LLC.

Start with the lease, not the residential eviction rules. Ohio’s residential landlord-tenant law (R.C. Chapter 5321) covers homes, not storefronts, offices, or warehouses — for a commercial space, the lease itself is the rulebook, plus Ohio’s eviction statute (R.C. Chapter 1923). And here commercial law differs from residential in one big way: self-help.

If the lease expressly allows the landlord to re-enter on default, Ohio courts allow a commercial landlord to peaceably repossess — for example, by changing the locks — without a court order, as long as there is no breach of the peace (Northfield Park Assocs. v. Northeast Ohio Harness, 36 Ohio App. 3d 14 (1987); Craig Wrecking v. Loewendick & Sons, 526 N.E.2d 321 (1987)). The lockout and utility-shutoff ban in R.C. 5321.15(A) covers residential premises only. But the right comes from the lease: no clause, or tenant resistance, means use the court process.

That court route starts with the lease’s default section — grace period, late fees, and any notice the lease requires — then written notice to leave at least three days before filing (R.C. 1923.04(A)), by certified mail, hand delivery, or leaving it at the premises. If the rent is still unpaid, file a forcible entry and detainer action in municipal or county court for breach of a written agreement (R.C. 1923.02(A)(9)).

Two cautions: no force or threats — any breach of the peace ends the self-help right — and do not seize the tenant’s property or cut utilities as leverage; those moves create separate claims. Unpaid rent is a contract claim under the lease, so keep every invoice, notice, and payment record, and get any partial-payment deal in writing.

The practical takeaway: for commercial space, the lease decides — an express self-help clause plus a peaceable lockout is lawful in Ohio; no clause, or any resistance, means court.

Questions? Contact us at info@leijianglaw.com or (440) 835-2271, or book a free 15-minute call: https://calendly.com/leijianglaw-info/15-minute-consultation

This article is general information, not legal advice for your situation.

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Business Estate and Trust Real Estate

Investors! Real Estate Succession Made Simple

For many families and investors, real estate is one of their most valuable assets—whether it’s a rental property, commercial building, or a family home held for generations. But what happens to that property after you’re gone, or if you become unable to manage it? That’s where real estate succession planning comes in.

Why You Need a Succession Plan for Your Properties?

Owning real estate without a plan for the future can lead to:

  • Probate delays and unnecessary legal fees
  • Family disputes over ownership or responsibilities
  • Loss of rental income or mismanagement
  • Tax consequences that could have been avoided

Tools to Make It Happen

Depending on your situation, a well-crafted plan may include:

Living Trusts

By titling your real estate in the name of a revocable living trust, you can avoid probate and ensure a seamless transition of ownership. These trusts are flexible and can be amended as your life or goals change.

Irrevocable Trusts

For those looking for asset protection, estate tax planning, or long-term succession control, an irrevocable trust may be the right tool. Once property is placed into an irrevocable trust:

  • It’s generally removed from your taxable estate.
  • It may be shielded from creditors or Medicaid claims (after a 5-year lookback).
  • You can set firm conditions on how and when heirs receive the property.

LLCs or Partnerships

For commercial or multi-unit residential properties, holding real estate in an LLC or family limited partnership allows for structured management and ownership transfer while offering liability protection.

Transfer-on-Death Affidavits (in some states)

A simple way to name a beneficiary for real estate without going through probate, where available.

Buy-Sell Agreements

Essential for properties co-owned with family or business partners, these agreements outline what happens to each party’s interest in the property if they leave or pass away.

Don’t Wait Until It’s Too Late

Succession planning isn’t just for the ultra-wealthy. Even if you own one rental house, making a plan today can prevent serious headaches tomorrow. Work with us—an attorney experienced in real estate and estate planning—to design a plan that meets your specific goals.

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Business News Real Estate

A Successful Trial in U.S. District Court for Northern District of Ohio

One more successful trial was conducted by attorneys in Lei Jiang Law Firm. Attorney Jiang was the lead counsel. He, et al. v. Rom, et al., Case No. 1:15-CV-01869, was initially filed as a class action in the U.S. District Court for Northern District of Ohio. Three Plaintiffs represented a class of 140 people against eight individual and corporate defendants.  Class action, international parties, service issues, taking evidence under Hague Convention, and electronic discovery all render this case one of the most complex cases.  But we see it as an opportunity to establish ourselves in the global litigation and advanced dispute resolution arena.

Electronic discovery presented a unique challenge in this case.  Our firm represented Plaintiffs and were dumped with 86 gigabyte (GB) of electronic stored information (ESI) after a successful motion to compel filed by us.  The dumping was just one month before the discovery cut off deadline. Considering that 1GB typically contains 64,782 pages of documents (more pages for email files).  86 GB contains an enormous amount of documents for review. Yet, we swiftly employed a comprehensive strategy, utilized latest software and platform, and conducted document review in the most effective and efficient manner.  Our team, attorneys and computer forensic expert, worked diligently on the data.   As a result, the relevant information was quickly extracted for litigation. We were able to review a large amount of information within a relatively short period of time.

Although Plaintiffs’ effort in class certification failed, the final result was a success. The case proceeded to trial. The four day trial resulted a complete victory for our clients.  Plaintiffs prevailed on all claims submitted to the jury, including fraud and violation of Ohio Deceptive Trade Practice Action.  Plaintiffs also successfully pierced corporate veils of all remaining corporate defendants – making their owner(s) personally liable for the corporate misconduct. Finally, Plaintiffs were awarded with punitive damage and attorney fee.  This was a stunning victory for Plaintiffs, considering fraud, piercing the corporate veil, and seeking punitive damage were the most difficult tasks in any lawsuit.

In this case, we also utilized new technology for virtual remote deposition and contemporaneous transmission of trial testimony from the other side of the globe – Hong Kong.  The new technology we used was tested for the first time in the Northern District of Ohio.  It significantly reduced the cost, and eased restrictions on time, place, facility and equipment.  In this case, legal expertise and technology worked together seamlessly.

It must be mentioned that Plaintiffs were fortunate to have the case be heard in the court of honorable Judge James Gwin. Judge Gwin took no shortcuts, made no detours, and in this case, he made the complete journey necessary to accomplish justice.

If you or your company need a competent law firm to handle international disputes or litigation, please contact us.

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Business News Real Estate

Media Report of Zheng, et al. v. SouFun, et al.

On August 23, 2015, Ms. Zheng and several others, as representatives of a class, filed a class action at U.S. District Court Northern District of Ohio against the biggest online real estate investment portal in China SouFun Holding Ltd. and SouFun International Ltd.

The complaint alleged fraud, violation of Ohio Deceptive Trade Practice Act, violation of Ohio Consumer Sales Practice Law, violation of Ohio real estate law, unjust enrichment, and breach of fiduciary duty. Lei Jiang Law Firm represents Plaintiffs and the class.

Since this was a case involving international parties, the service was a challenge because it must go through Hague Convention service of process. Plaintiffs successfully perfected the service through Hague Convention.

Major Chinese media in China and the U.S. and have reported on this case. The case is being closely watched by many due to the ever increasing trend of Chinese investing in the U.S. and global real estate.

For a report from the People’s Daily, the official media, click here.
Reports from the biggest Chinese media (in Chinese) QQ, Sina, SOHU, NETEASE.
Reports from the biggest U.S. Chinese media (in Chinese) USChinaPress， 中金在线.

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