A like-kind exchange can help you reduce your capital gains tax burden when you sell commercial real estate. In this article, we are going to discuss how you can reduce your capital gains tax burden on the sale of commercial real estate.
Make Sure Your Property Qualifies
Before you begin the 1031 exchange process, you first need to determine whether or not your property qualifies for 1031 treatment. The basic benchmark is that your property needs to have been held for investment or business use. Real estate that you hold for personal use cannot be used in your 1031 exchange. Both your relinquished property and your replacement property also need to be like-kind (which essentially includes all real estate that’s held for investment purposes).
Work with a Qualified Intermediary
Hiring a qualified intermediary to help you with your 1031 exchange is one of the best things you can do to ensure a successful exchange. A qualified intermediary can advise you throughout your exchange, make sure you don’t succumb to any common 1031 traps, and prepare all of your exchange documentation for closing.
MN Like-Kind Exchange Intermediaries
1031 exchanges can be complex, and if you don’t know what you’re doing, you may end up with a failed exchange. Working with a qualified intermediary is your best bet for ensuring a successful exchange. An intermediary works with you through every step of the exchange – from document preparation, to finding the right replacement property, to closing. They take care of all the heavy lifting so you don’t have to. CPEC1031, LLC has been facilitating exchanges for over twenty years. Our qualified intermediaries have everything you need to set up and execute your like-kind exchange of real estate. Contact us today to talk about the details of your exchange!
Start Your 1031 Exchange: If you have questions about 1031 exchanges, feel free to call me at 612-643-1031.
Defer the tax. Maximize your gain.
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