1031 exchanges are very popular among farmers who want to sell their current farmland and reinvest in larger property while deferring capital gains taxes. Many people wonder what type of property farmers typically exchange into after selling their farmland.
In general, Minnesota farmers want to buy more farmland – ideally close to their home. They don’t want to be farming land on the other side of the county. Additionally, farmers typically want to buy really productive land. There are two primary considerations farmers have when considering 1031 replacement property:
· What is the soil like?
· How close is it to my home farm?
Of course, not all farmers exchange into more farmland when doing a 1031 exchange. Perhaps a farmer has children who all went into different careers and have no interest in continuing the family farming operation. In this type of situation, farmers will often exchange into DSTs to ensure a more reliable income stream for the remainder of their lives. Farmers who have multiple heirs also often utilize a DST conversion into an UPREIT that makes it easy to dole out shares to numerous heirs.
Our Qualified Intermediaries are Here to Help You
The qualified intermediaries at CPEC1031, LLC are ready and waiting to help you with your exchange of investment real estate. With more than twenty years of experience at our back, we are more than prepared to handle whatever comes our way during the course of your 1031 exchange. Start realizing the tax-saving benefits of section 1031 today by contacting a qualified intermediary who can explain the process and guide your decision-making. Find us at our Minneapolis offices and schedule a time to chat today!
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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