1031 exchanges have changed over the years due to various laws, cases, and private letter rulings. In this article, we are going to discuss how 1031 exchanges are different in 2021 and how to effectively manage your exchanges in the future.
Remember the Tax Cuts & Jobs Act
The Tax Cuts & Jobs Act that went into effect a few years ago significantly changed the 1031 exchange landscape. Thankfully, the Act preserved like-kind exchanges of property, but it also axed exchanges of personal property. That means personal property items that were once allowed under section 1031 (such as business property, artwork, aircraft, and the like) are no longer eligible for 1031 treatment.
1031 Tips for the Future
1031 exchanges are ever-evolving, but with enough planning, you can utilize them to your benefit. The first thing to remember for future 1031 exchanges is that you’re not going to be able to exchange personal property. Keep it confined to real property. Next, remember to always work with a qualified intermediary on your exchange. Intermediaries understand the ins and outs of 1031 exchanges better than anyone, so they are well-equipped to help you navigate the rough waters of the 1031 exchange process.
We can Help
The qualified intermediaries at CPEC1031, LLC have been facilitating like-kind exchanges for more than twenty years. Our qualified intermediaries work with investors large and small to help them defer taxes when selling real property. We can help you understand the process and ensure that you feel comfortable throughout your exchange. Reach out to us today to learn more about the process and how we can help. Our main office is located in downtown Minneapolis but we work with clients across the state of Minnesota and the entire United States.
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.