Tenants-in-common (TIC), also known as fractional ownership in real estate, allows investors to own an undivided fractional interest in an institutional-grade property, enjoy the benefits, risks, and rewards of property ownership.  TIC owners receive a separate deed, (unless the property is structured as a Delaware Statutory Trust (DST), in which case they recieve a certificate of trust based upon their share of ownership) and   separate title insurance for their percentage interest in property and have the same rights as a single owner.

In addition, TIC properties, or 1031 replacement properties,  according to IRS issued Revenue Procedure 2002-22 qualify for a 1031 tax  exchange. TIC investments have become an opportunity for property owners looking to conduct a 1031 tax deferred exchange.  These 1031 replacement properties enable the average real estate owner to exchange out of appreciated real estate and into institutional properties nationwide. 

TIC properties are managed by professional real estate companies, relieving TIC owners from the headaches of daily management.  The income, debt, tax benefits and risks are shared among owners in direct relation to their percentage of ownership.  Although, when it comes to income tax, everyone’s situation is different, so the application of tax principals may provide different results for each investor.   A 1031 exchange done correctly can defer the taxes on your capital gain.