Prior to 2018, you could 1031 exchange personal property for personal property. An example would be an airplane for an airplane, or a helicopter for a helicopter. However, you can now only 1031 exchange real estate for other like-kind real estate. Within that broad category of real estate there is a great degree of opportunity to exchange into different geographic areas and segments. You can go from Arkansas to New York, or you can go from unimproved agricultural property to improved property. You can change the type of investment that you’re in as well. For example, many people like to exchange into multi-family real estate, or office space, or hotels. Whatever you fancy, you can exchange into. The really interesting thing is folks that are exchanging to other states in order to avoid inheritance or estate taxes. Exchanging into a tax-friendly state may be a way to enhance how much the next generation is able to inherit because you’re escaping some of the higher tax 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.
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