A lot of people (incorrectly) assume that 1031 exchanges are only for big investors. The fact of the matter is that any United States taxpayer can benefit from the tax-saving benefits of 1031 exchanges – even small “mom and pop” investors. In this article, we’re going to talk about how small investors can avail themselves of the benefits of section 1031 of the Internal Revenue Code.
1031 Exchange Rules
While there are many rules that govern how 1031 exchanges operate, there are no rules that prevent a small-time investor from conducting an exchange of real estate. Here are the important rules you need to be aware of if you’re a small investor interested in doing a 1031 exchange:
Timing. The first rule is timing. Once you sell your relinquished property, you only have 180 days to complete your exchange.
Property. All property involved in the exchange must be like-kind real estate. No personal property, or real estate held for personal use.
Debt, Equity, Value. You also need to make sure that your replacement property greater than your relinquished property in terms of debt, equity, and value.
1031 Exchanges for Small Investors
CPEC1031 works with investors large and small on their 1031 exchanges of real estate. Our qualified intermediaries have more than two decades of experience helping taxpayers defer their capital gains taxes on the sale of real property. Contact us today to learn more about our like-kind exchange services and set up your appointment with one of our qualified intermediaries. You can find us at our main office located in downtown Minneapolis.
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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