Many people ask about the variety of different replacement property options that are available in a 1031 exchange and what exactly constitutes “like-kind” in the realm of real estate.
If you’re exchanging a duplex can you exchange into something completely different such as an oil and gas program? In fact there are 1031 compliant oil and gas programs that you can exchange into. There are also tenant-in-common arrangements that you can exchange into, as well as Delaware Statutory Trusts (DSTs), some of which convert into a 721 contribution of the underlying real estate into an UPREIT. So there’s a great variety of different products that you can 1031 exchange into.
One of the common themes with all of these options is that they are passive investments that allow you to work smarter, not harder.
1031 Exchange Services
A 1031 exchange is a powerful vehicle for tax-savings for owners of investment real estate. Under section 1031 of the Internal Revenue Code, you are allowed to defer capital gains taxes on the sale of qualifying real property when you reinvest your net proceeds into like-kind replacement property. Once you begin the process you must complete everything within 180 days so it’s important to adequately prepare. The best way to set yourself up for success is to coordinate with an experienced 1031 intermediary at CPEC1031, LLC.
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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