05/03/2024
A 1031 Exchange, per Internal Revenue Code (Internal Revenue Code) Section 1031, permits investors to sell real estate and trade into a “like kind” property while deferring capital gains. This tool has long been used by investors to increase their returns, reduce their tax burden, and ultimately build their wealth. However, the Internal Revenue Service (IRS) has outlined strict guidelines for a 1031 Exchange, including who is authorized to engage in an exchange.
Individuals, C corporations, S corporations, partnerships (general and limited), limited liability companies (LLCs), trusts, and any other tax-paying entity may qualify for a 1031 Exchange.
Those considering selling real estate that is held in a partnership structure are advised to prepare for the sale. Speak with the appropriate representatives, including a certified public accountant (CPA) and accommodator, to plan for the sale. Via preparation, investors can reduce their risk of triggering a taxable event at the time of the sale, which could carry a heavy financial burden.
If you would like to learn more about a 1031 Exchange, and how you can benefit from an exchange, contact the team at Statewide Title Exchange Corp. ‘STEC’ www.1031stec.com
