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Learn about the rules and requirements for like-kind exchanges of real property under IRS Code Section 1031. Find out how the Tax Cuts and Jobs Act limits the application of Section 1031 to exchanges of personal or intangible property.
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Learn how to postpone paying tax on the gain from selling business or investment property by reinvesting in similar property under Section 1031. Find out the rules, regulations, structures, time limits and restrictions for qualifying for a like-kind exchange.
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Nov 29, 2023 · The 1031 exchange, while advantageous, is bound by stringent regulations set forth by the IRS. To qualify for this tax-deferral strategy, you must meet specific criteria and follow certain...
Apr 19, 2024 · Learn what a 1031 exchange is, how it works, and what are the IRS rules and requirements for real estate investors. Find out how to use 1031 exchanges to defer capital gains tax, avoid depreciation recapture, and swap like-kind properties.
- 1031 Exchanges Are Also Known as ‘Like-Kind’ Exchanges, and That Matters. Section 1031 of the IRC defines a 1031 exchange as when you exchange real property used for business or held as an investment solely for another business or investment property that is the same type or “like-kind.”
- Careful: You’re on the Clock! When contemplating a 1031 exchange, the race is indeed to the swift, or at least to the efficient: You have 45 days from the date of the original property’s sale to identify a new property to reinvest the proceeds.
- 1031 Exchanges Don’t Work to Downsize an Investment. The strict rules surrounding 1031 exchanges require the new investment property to be of equal or greater value than the property being sold.
- Transactions Can Be Structured in Four Different Ways. As needs vary depending on circumstances, real estate investors generally use five different kinds of 1031 exchanges
Feb 28, 2024 · A 1031 exchange, named after section 1031 of the U.S. Internal Revenue Code, is a way to postpone capital gains tax on the sale of a business or investment property by using the proceeds to buy...
Jul 9, 2024 · A 1031 exchange allows property owners to "swap" one investment or business property for another of equal or greater value while deferring capital gains tax and avoiding depreciation recapture. This tax break lets you upgrade to a higher-priced property without a significant tax bill.
