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Biden/Harris Tax Plan Reveals a $4 Trillion Tax Hike

A recent read of the Biden/Harris tax plan reveals a $4 trillion tax hike, and one of the considerations for funding this massive tax increase is a change of 1031 Exchanges.  

President Biden’s administration has proposed eliminating 1031 “like-kind” exchanges for investors with annual incomes of more than $400,000, as part of a plan to fund future government spending on childcare and elderly healthcare.  

1031 exchanges have been a part of the U.S. Internal Revenue Code since 1921. The law was originally passed by congress to stimulate economic growth. They allow real estate investors to defer capital-gains taxes when they sell properties by directing the proceeds into new investments, usually within a few months after the sale. As written, the rule allows investors to perpetually roll over capital gains into successive replacement property purchases, effectively eliminating tax liabilities through estate planning. 

Throughout U.S. history, investors have relied on real estate as a means of generating both income and capital appreciation. Low investment returns and stock market volatility have converged to create enormous demand for income-producing real estate that is often used to fund future liabilities.  

Now, more than ever, investors are looking to their real estate holdings to diversify away from market risk and provide a steady stream of income during retirement. For many 1031 exchange investors, their real estate holdings make up the largest portion of their net worth and are a key pillar in retirement planning. 

In light of potential policy changes and evolving tax reform, a possibly even bigger question is will commercial real estate investors be able to utilize 1031 tax deferred exchanges as a means of buying and selling properties in the future? 

This is not the first time that attempts have been made to eliminate 1031 exchanges but so far it continues to survive threats of repeal because lawmakers generally understand its positive impact on the economy.  

As Brad Watt, CEO of Petra Capital said, “eliminating exchange rules at a time when the economy is suffering from the coronavirus pandemic would deal a ‘one-two punch’ to real estate values. 1031 exchanges benefit the “everyday” man by allowing smaller and less capitalized real estate investors to increase their income and net worth by temporarily deferring tax on reinvested real estate sales proceeds.” 

Eliminating 1031 exchanges from the current tax code could have a profound negative impact on future real estate values and the economic prosperity of the many small investors who own investment property. For investors looking to sell their current investment property, there has historically been a long line of willing buyers. Investors have been eager to purchase stabilized income property with the added benefits of tax-sheltered income and the ability to protect future capital gains by utilizing 1031 exchange rules. 

Now with the twin-threat of coronavirus and looming tax reform, sellers and buyers of investment properties are beginning to recalibrate pricing and income expectations. Now, more than ever, investors are relying on the stability of their real estate holdings to hedge against an unstable and unpredictable economy. You can read more here

You can be sure that we will be watching this issue closely. We will absolutely keep you updated on the 1031 exchange and all policies that affect real estate. The market is in full swing, our team is always here for you!  

Best wishes,

Stacey Froelich

Samantha Wortmann
Licensed Real Estate Salesperson

Samantha Wortmann is a born and bred Manhattanite with Real Estate in her blood. As a member of the Stacey Froelich Team, Samantha brings a fresh new perspective and millennial skillset to a team with 20+ years of experience. With an unwavering work ethic and honest nature, Samantha is passionate about her product and creative in the approach. She creates strong relationships and elevates the experience for buyers and sellers alike.


With a keen eye for style, Samantha provides an imaginative vision for her clients. Along with natural talent, she brings an education from the New York School of Interior Design to the table making her an excellent advisor and executor of impactful home staging and interior design.


Samantha currently splits her time between the Upper East Side in a co-op that she personally designed and renovated, and a beautiful historic home in Ridgewood, NJ with her husband Robert and their newborn son, Tripp. In their spare time, the Wortmanns can be found playing with their dog, Goose, in Central Park, skiing in the Catskills, or boating off the coast of Connecticut.

Melina Marini
Licensed Real Estate Salesperson

From the first photo-shoot to the final page of an impeccable board package, Melina Marini is there with her clients every step of the way. Her passion and expertise for the NYC market make her a valuable resource for anyone from first time buyers/sellers to seasoned real estate investors. Her approach to real estate consists of 4 major components: service, attention to detail, market knowledge, and integrity.


Melina is a dedicated professional who helps sellers by crafting a detailed marketing and pricing plan to attract financially qualified buyers, and gives each listing the time and attention it requires to sell quickly, and for the best price. When working with buyers, she relies on a combination of listening to and interpreting the buyer’s needs, in order to find the ideal home at the ideal price, in the most convenient timeline. She lives by a steadfast rule of being accurate and efficient, which has made her a client favorite.

Prior to obtaining her real estate license, Melina worked as a project manager for a Downtown Brooklyn condominium conversion. She is a graduate of Mount Holyoke College with a B.A. in Music Performance. During her down time, Melina enjoys spending time with her wife and
australian shepherd, Lyon, in their cooperative in Bay Ridge, Brooklyn, and performs internationally with her six person vocal band, Concrete.

Carolyn Levitan
Licensed Real Estate Salesperson

As real estate is one of the most important and emotional decisions a person can make, Carolyn Levitan forges a true partnership with each client, understanding their unique needs in order to help them reach their goals. Carolyn acts as a trusted adviser through every stage of buying or selling a home. Seeing her clients appropriately invested and comfortably settled is Carolyn’s foremost priority. Her clients include everyone from first-time buyers to dedicated clients she has
helped through numerous purchases, sales, and investments throughout her 25+ years in the real estate industry. Each deal and each client are equally as important to Carolyn, and it shows.

Carolyn’s impeccable reputation, unparalleled knowledge, professionalism, and passion for the industry mean she is a go-to source not only among her clients, but also her colleagues. From
sitting on condo and co-op boards, to renovations and interior design, to handling new development projects from the ground up, Carolyn understands every facet of real estate from both professional and personal experience.

Originally from Sands Point, Long Island, Carolyn was raised by parents whose favorite hobby was buying and selling homes. Sunday family outings consisted of visiting model homes and real estate chatter. After raising her daughter on East 72 nd Street, Carolyn moved to Flatiron, where she has resided for the last ten years.

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Mike Biryla
Licensed Real Estate Salesperson

Michael understands how life-changing and stressful buying, selling or renting a home can be. He goes above and beyond for his clients in every aspect of the process, to ensure that this decision is easy and stress is minimized. “I treat your real estate needs with the ultimate level of care and attention, as if it were my own home. Quality service is always number one. I’ll work tirelessly on your behalf to protect your best interest and deliver results you’re thrilled with.”

A Licensed Real Estate Salesperson in the vibrant New York City market since 2013, Michael catapulted to success as a top-producing agent at his previous rental firm. He was the number one agent in his Upper West Side office two years in a row, and expanded into residential sales arena when joining The Stacey Froelich Team at Compass.

Michael specializes in sales and rentals in all Manhattan neighborhoods and is sensitive to the urgent nature of securing or selling real estate in New York. He is a skilled listener and negotiator with a flair for what he does, and great persistency to achieve success. Years in the hospitality industry taught Michael to be extremely detailed and customer oriented. Michael has the ability to relate to people from all backgrounds and walks of life. He makes a point to remember the little things about a client, from their kids’ and pets’ names to birthdays and anniversaries; because to him, relationships will continue long after deals are closed.Michael is a native New Yorker from Long Island. He lived in North Carolina for a short time but knew New York was his true home. Michael currently resides in Astoria, an area bustling with new development. Outside of real estate, Muay Thai is his biggest passion. Being a longtime competitive Muay Thai Boxer has fueled his desire to push himself to the limit and outperform under pressure. Family means the world to Michael and consumes much of his free time.

Robert Godby
Licensed Real Estate Salesperson

New York is a city of serendipity, a fact Robert Godby can personally attest to. The path he walked to and from his former job at Mount Sinai Hospital led him past a real estate office window each day. “I would always stop and look at the floor plans and photos,” he says. In 2010, Robert decided to take the leap into real estate himself, starting as the executive assistant to the CEO of one of New York’s top firms and then as a licensed salesperson. Robert is a proud member of the Stacey Froelich Team at Compass since 2013.

Since then, he’s separated himself from the pack with his tenacious dedication, detail-oriented focus, and ability to maintain calm during any stressful situation. Robert specializes in sales and rentals in Manhattan and prides himself on being available to his clients, even after a transaction is complete. “I want to make the process smooth and fun,” he explains. “My favorite part of this job is meeting people.”

Robert combines his love for working with people, technology, and marketing expertise in order to make the buying and selling process as seamless as possible. A Philadelphia native, Robert holds a bachelor’s in political science from Radford University in Virginia. He has called New York City home since 2009, and in his free time, he enjoys running and staying physically active, reading and traveling.

Carla Slocum-Friedman
Licensed Associate Real Estate Broker

Her love of architecture, interior design, and the elements of home are what most draw Carla to the world of selling real estate. This, combined with her passion for life in New York City and her in-depth knowledge of Manhattan make her a powerful partner for anyone seeking a home or apartment here. Carla believes that the purchase of any piece of real estate should ideally be two-fold. It should afford an opportunity for investment and capital appreciation, while acting as a sanctuary and emotional haven for the owner. Her goal is to deliver the highest possible quality service to enable both buyers and sellers to seamlessly achieve their financial and personal goals. Carla brings skill, dedication, honesty, and integrity to her work, as well as a sense of humor.

Having lived in Manhattan since graduating magna cum laude from the University of Pittsburgh, Carla has spent the last thirty years exploring the diversity of each of the neighborhoods within the city, and is well-versed on the landmarks and distinctive attributes of each, especially parks, restaurants, transportation, and services. Prior to entering real estate, Carla spent twenty-five years as a senior fashion executive who successfully built brands and grew revenue and profit within a variety of retail and wholesale venues. Carla’s expertise in design, merchandising, and marketing serves her extremely in real estate. Outside of work, Carla spends leisure time with her fearless Wire Fox Terrier, Asta, her husband David, and her two children. She enjoys working on design projects, theatre, antiquing, and spending as much time as allowed at her home in Bridgehampton.

Stacey Froelich
Licensed Associate Real Estate Broker
Stacey grew up in New York and moved back to live in Manhattan after graduating from the University of Florida in 1995. Stacey began her career in residential real estate in 2001.  Real estate is the perfect career for Stacey due to her ability to connect with people, her ability to balance a fast-paced business, juggling many balls at once, and maintaining focus and organization throughout the process. Stacey heads her team of dedicated, hard-working, driven agents. Stacey is extremely conscientious in making sure all of her endeavors yield successful results for her clients, with no exception. She is driven to ensure her buyers find a place that feels like home and that her sellers receive maximum exposure with a goal to procure the most qualified buyer at the highest possible price.
 
Stacey truly sees the value in building long-standing relationships with her clients. She spends time with each of them to ensure they know she is there to support and guide them throughout this process. Stacey’s motto is that relationships are the key to her success, which is what makes her personal and professional life so fulfilling.

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