In this article, we are going to discuss what to do when selling a property on contract-for-deed and receiving balloon payoffs. In this situation, is it better to do a 1031 exchange or invest in a qualified opportunity zone?
Selling on a Contract-for-Deed
If you sold a property on a contract for deed and are now receiving the balloon payoff from the vendee, it is probably too late for you to do a 1031 exchange on this payment because equitable title was probably conveyed when you granted the contract for deed (probably more than 180 ago) to the vendee, so another option to consider is to re-invest the profit or gain into a Qualified Opportunity Zone investment.
CPEC1031
At CPEC1031, LLC, we help taxpayers facilitating exchanges under section 1031 of the Internal Revenue Code. Our professionals have over two decades of experience guiding people through the 1031 exchange process. We can prepare all of your 1031 documentation, advise you on replacement property, and more! Contact us today at our downtown Minneapolis office or at one of our satellite offices to learn more about the exchange process!
Start Your 1031 Exchange: If you have questions about 1031 exchanges, feel free to call me at 612-643-1031.
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