What Kind Of Real Estate Qualifies For A 1031 Exchange?
Almost every kind of real estate is considered "like kind" and can be exchanged for any other real estate, including vacant land for apartments, a rental house for a shopping center, an office building for a leasehold interest with 30 years or more remaining, as long as you hold them for investment or business use.
Other 1031 Exchange FAQs
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Q:
What Is 1031 Exchange?
A: A 1031 exchange is a method for deferring capital gains tax on a real estate transaction. -
Q:
How Can I Qualify To Defer My Taxes When I Sell My Property?
A: Any investor can qualify! Section 1031 of the IRS code lets you sell your property and buy a new property and deferring the payment of taxes owed. You simply … More -
Q:
What Is A Qualified Intermediary?
A: The IRS says if you touch the money you pay the tax. However, if you use a qualified intermediary to transfer the money from the sold property into the purchased … More -
Q:
Can I Get Legal Or Tax Advice From An Intermediary?
A: No, the IRS doesn't allow a person to act as both your qualified intermediary and your attorney or tax advisor. So work with your attorney and CPA to make sure your … More -
Q:
Can I Avoid Paying Taxes Forever?
A: Yes, you can. By simply following the 1031 exchange rules every time you sell one or more properties and buy replacement properties, when you die your estate escapes … More -
Q:
What Exactly Are The Tax Advantages In Exchanging?
A: You can eliminate paying any capital gains taxes, and you can eliminate paying the even higherrate taxes on the recapture of depreciation you've taken on your … More -
Q:
Are There Reasons To Exchange Other Than Tax Advantages?
A: Yes, there are many nontax reasons to exchange. For example, if you no longer like managing property, you can exchange your management intensive property for … More -
Q:
How Long Can I Take To Buy A New Property?
A: You have 180 days between the closing date on the sold property and the closing date on the purchased property. -
Q:
Can I Buy A New Property Before Selling My Old One?
A: Yes, you can buy a new property before selling the old property and still qualify it's called a "reverse" exchange. A qualified intermediary takes title to the … More -
Q:
Can I Get Money Out Of The Exchange Tax Free?
A: Yes, one way is to complete the exchange first and then refinance the new property.