Are you a real estate investor or property owner interested in utilizing the 1031 exchange rule in your transactions? The 1031 exchange rule is a section of the Internal Revenue Code, written by Congress, allowing anyone who meets all the requirements to sell their property and defer paying captial gain taxes.. The 1031 Exchange Rule may be a valuable resource.
Always consult with a Real Estate Lawyer to properly structure the 1031 exchange rule transaction. Contact a Real Estate Lawyer in your area to lean more about the 1031 exchange rule.
A properly structured exchange allows an investor to sell a property, to reinvest the proceeds in a new property and to defer all capital gain taxes In order to access the full potential of these benefits, it is crucial to have a Real Estate Lawyer with a comprehensive knowledge of the exchange process and the IRC.
- A 1031 exchange permits investors to sell and buy comparable properties types while deferring the capital gain taxes.
- Authorized by section 1031 of the IRS code and offers protection of thereal estate assets.
- A 1031 exchange permits the investor to reinvest 100% of the equity from the sale of a property, followed by the purchase of a preferred replacement property without recognizing any gain.
- This type of property sale and reinvestment can either be done through a simultaneous or delayed 1031 exchange.
- In most cases a 1031 exchange is done as three-party delayed exchange also known as a "Starker Exchange" in which an intermediary ensures a reciprocal transfer of the properties and provides a "safe harbor" against the actual receipt of exchange funds.
- It is extremely important that this process be done correctly, otherwise, a taxable event may occur.
1031 exchanges provide real estate owners an opportunity to build upon their net worth, while increasing a real estate portfolio.
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Always consult with a Real Estate Lawyer to properly structure the 1031 exchange rule transaction. Contact a Real Estate Lawyer in your area to lean more about the 1031 exchange rule.
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