1031 Exchange

PDF  | Print |  E-mail

Are you selling a real property held for investment or business, and you do not want to pay capital gains tax on the money you will receive at closing, if so there may be a benefit from re-investing into property of like kind through a 1031 Tax-Deferred Exchange. 

What is a 1031 Tax-Deferred Exchange?

When the proceeds from the sale of investment real estate are used to purchase other like-kind investment real estate, you should consider a Tax-Deferred Exchange. The sale and purchase of investment property can be done as a delayed exchange or a simultaneous exchange. Both qualify for tax-deferment. Section 1031 of the Internal Revenue Code, 1031

Like-Kind Property Definition

Like-Kind Requirement - Replacement property acquired in an exchange must be "like-kind" to the property being sold (relinquished property. Like-kind means "similar in nature or character, notwithstanding differences in grade or quality." In order for the properties to qualify as "like-kind" they must be held for productive use in a trade or business or held for investment purposes and be located within the United States. For example: raw land held for investment may be exchanged for single family rentals or any combination of the below examples:

 * Single Family Rentals
* Farms/Ranches
* Offices
* Motels/Hotels
* Golf Courses
* Multi Family Rentals
* Raw Land
* Retail
* Industrial
* Leases of 30 years or more

 

Property Not Eligible Under 1031:

* Primary Residence
* Interest in Partnerships
* Foreign Property
* Money
* Stocks, Bonds, or Notes
* Stock in trade, inventory or other property held inherently for sale

 For more information about 1031 Tax Deferred Exchanges or to find a Accommodator or qualified intermediary go to Pioneer 1031 Tax Deferred Exchange

Need to find a replacement property?  Search for residential, vacant land, commercial or business listings listed in the Southwest Idaho Intermountain MLS - Search MLS OR Contact us Today!

 

Like What You See?

If you're ready to buy or sell Idaho homes,
please contact us today: (208) 899-3352.

RE/MAX Executives
46 Eagle River Street Suite 130
Eagle, ID 83616