Is a 1031 Exchange Right for You?
Business owners and taxpayers who want to accomplish a wide range of business and/or investment objectives have several tax benefits that they may be eligible to take advantage of. One of those options is a 1031 Exchange . Through a 1031 exchange, real estate owners can defer capital gain taxes when they sell a business or investment property and use the proceeds of the sale to purchase another property ‘similar’ to the first. So, how does a 1031 exchange work and how could it benefit you? Take a look. What is a 1031 Exchange? A properly structured 1031 exchange allows an investor to sell a property, to reinvest the proceeds in a new property and to defer all capital gain taxes. IRC Section 1031 (a)(1) states: “No gain or loss shall be recognized on the exchange of real property held for productive use in a trade or business or for investment, if such real property is exchanged solely for real property of like-kind which is to be held either for productive use in a trade or bus...