What is a 1031 Exchange?
A 1031 Exchange is an IRS approved technique that allows real estate investors to sell a property, defere their capital gains taxes and exchange into like-kind replacement property. A like-kind property must be identified within 45 days, and closing escrow on the new property within 180 days.
In evaluating whether a Section 1031 exchange is right for you, the first step is to contact your tax professional (CPA or tax attorney) and determine the taxable basis of the property you wish to sell. This will allow you to determine the amount of tax that you can defer.
What is a "like-kind" property?
A like-kind property is real property such as raw land, an apartment building, rental home, or a retail center. One or more properties can be exchanged into one or more replacements properties.
What is an Exchange Accommodator ('Qualified intermediary')?
An exchange accomodator or qualified intermediary, is a third party that helps facilitate the exchange. The exchange accomodator holds the proceeds of the property sale (downleg), and moniters dates necessary to satisfy the 1031 exchange requirements.
Hablo Español
DRE # 01770577
|
Oscar Barragan
REALTOR®
REO Division
12501 Philadephia St.
Whittier, CA 90601
|
|