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1031 Exchange
- I know about 1031 Exchange and I am researching different options.
- I know nothing about 1031 exchange--educate me.
Options for 1031 Exchange:
What is 1031 Exchange?
In 1990 the IRS inacted the rules on Deferred Exchanges in Section 1.1031 of the IRS code which details the process of turning a sale and purchase type transaction into an exchange. These rules allowed owners of certain types of like kind real and personal property to sell their property and buy other like-kind property without paying capital gains tax. The like-kind provision is broad, including land, rental and business property--any of which can be exchanged for the other. The like-kind provision for Personal property is more restrictive. This type of property must be in productive use in a business (depreciable property), and can only be exchanged for the same type of property.As an example a business aircraft for a business aircraft (a fixed wing airplane for a helicopter will work), or a commercial truck for a commercial truck, etc.
The rule also required that the "Exchanger" use a safe harbor to hold the proceeds while the exchange was in progress, and spelled out what those safe harbors were.
The only practical safe harbor for most "Exchangers" is a "Qualified Intermediary."
Who can help you with your 1031 Exchange?
- Realty Exchangers, Inc., is a qualified intermediary, and is set up to assist you in making a smooth and easy exchange.
- http://apiexchange.com/index_main.php?id=1
Qualified Intermediary - The Qualified Intermediary industry is not nationally regulated.
Time Limits for 1031 Exchange
45/180 Day Time Requirements Calendar
The time requirements a 1031 tax deferred exchange are specific. After closing on the sale of the relinquished (sale) property, an Exchanger must:
- Properly identify potential replacement properties within 45 calendar days (the"Identification Period"); and
- Close on the replacement properties within 180 calendar days of the relinquished property sale - OR - the due date (including extensions) for the Exchanger's tax return for the taxable year in which the reliquished property was tranferred, whichever is earlier (the "Exchange Period") Without taking into consideration an Exchanger's potential tax filing date restriction and based upon the closing date submitted, the 45-day Identification Period and 180-day Exchange Period deadlines are shown below:
Competitor Websites
http://www.realtyexchangers.com
http://apiexchange.com/index_main.php?id=1
Common Titles
- A tax haven for preserving real estate wealth
- Asset preservation
- Defer capital gains taxation indefinitely
- Defer taxes
Tools
- Capital gains tax calculator
- Time requirements calculator
- Star investment analyzer
- PDF handouts available for educating clients
Examples
- Need examples of deals in terms of dollars
Competition is the Tenet & Common
http://www.ticassoc.org/
How to determine whether your real estate could be a 1031 exchange:
1.
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