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A 1031 exchange refers to Section 1031 of the Internal Revenue Code whereby the tax on the effective gain resulting from the sale of an investment property can be postponed if you reinvest the proceeds in a like-kind exchange. According to the IRS website,
“Whenever you sell business or investment property and you have a gain, you generally have to pay tax on the gain at the time of sale. IRC Section 1031 provides an exception and allows you to postpone paying tax on the gain if you reinvest the proceeds in similar property as part of a qualifying like-kind exchange. Gain deferred in a like-kind exchange under IRC Section 1031 is tax-deferred, but it is not tax-free. The exchange can include like-kind property exclusively or it can include like-kind property along with cash, liabilities, and property that are not like-kind. If you receive cash, relief from debt, or property that is not like-kind, however, you may trigger some taxable gain in the year of the exchange. There can be both deferred and recognized gain in the same transaction when a taxpayer exchanges for like-kind property of lesser value.”
Yes, we can most certainly help with your exchange. The vast majority of our clients chooses to do a 1031 exchange when selling an investment property. We have successfully facilitated numerous exchanges, and we would be delighted to assist you.
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