Where Should Your 1031 Exchange Take Place?

There are many common questions that arise throughout the 1031 exchange process. One area many people have questions about is geography as it relates to their exchange. In this article, we are going to talk about where your 1031 exchange should take place.

Property Location

All property exchanged in a 1031 transaction must be like-kind. Thankfully, the definition of like-kind in this context is quite broad. Most investment real estate is like-kind with most other investment real estate. The geographic location of your property (so long as it’s in the United States) doesn’t matter too much. You can conduct an exchange across different states. For example, you can sell a relinquished property in Wisconsin and purchase a like-kind replacement property in North Dakota.

Qualified Intermediary Location

On a similar note, the qualified intermediary you work with on your exchange does not need to be located in the same area as you or your property. You can hire a qualified intermediary in Minnesota to facilitate an exchange of properties located in Florida, for example. It’s important, however, to make sure your intermediary is familiar with the local customs where your transaction is taking place.

Find a Qualified Intermediary Near You

The first step in any 1031 exchange is to find a qualified intermediary who can help you through the ins and outs of the exchange process and insulate you from receiving any taxable boot. CPEC1031, LLC stands ready and waiting to assist you through the details of your like-kind exchange. Let us put our 20+ years of experience to work on your exchange and help you defer your capital gains tax burden on the sale of qualifying investment real estate.

• 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.

© 2024 Copyright Jeffrey R. Peterson All Rights Reserved

Ask Your Qualified Intermediary These 1031 Exchange Questions

There’s a lot to be aware of in a 1031 exchange of real estate and your qualified intermediary is a great resource for all things related to section 1031. But before you start the process, you should ask your intermediary some questions about themselves. In this article, we are going to discuss a few questions you should ask your qualified intermediary before beginning your 1031 exchange.

How Long Have Your Been Conducting 1031 Exchanges?

Experience goes a long way in the like-kind exchange industry. Ask your qualified intermediary how long they’ve been conducting 1031 exchanges to make sure they have the experience necessary to guide you through the process.

Do You Have Experience Working on Exchanges Like Mine?

There are several different types of 1031 exchanges – from forward exchanges, to reverse exchanges, to build-to-suit exchanges. Each of these comes with its own unique challenges. Make sure your intermediary has experience working on the specific type of exchange you plan on conducting.

What is Your Fee?

It’s also a good idea to make sure you understand the qualified intermediary’s fee structure. Ask your intermediary about this before you begin the process so there are no surprises later on. You can also ask about other fees that may be involved in the transaction that you can expect to pay.

Like-Kind Exchange Company

CPEC1031, LLC is a like-kind exchange company with over twenty years of experience facilitating 1031 exchanges of all types (forward, reverse, build-to-suit, and more). Our industry experience makes us a great fit to guide you through the 1031 exchange process. We can advise you on the 1031 exchange rules, prepare any required documentation, and answer all of your questions along the way. Contact us now to learn more about the tax-deferral benefits of the 1031 exchange. Our team is ready and waiting to work hand-in-hand with you throughout the process.

• 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.

© 2024 Copyright Jeffrey R. Peterson All Rights Reserved

Be Mindful of These Potential 1031 Exchange Traps

1031 exchanges are complex – there are many rules you need to abide by in order to complete a successful exchange and fully defer your capital gains taxes. In this article, we are going to outline some potential traps you might encounter during the course of your 1031 exchange.

Running Out of Time

This is the easiest issue to run afoul of if you’re not careful. 1031 exchanges are bound by strict timelines that cannot be exceeded (except in very rare cases). Specifically, you have only 180 days in total to complete your exchange process after you start it. If you do not finish the process within that timeline, your exchange will fail and you won’t be able to defer your capital gains tax burden.

Only Deferring Some of Your Capital Gains Taxes

In an ideal 1031 exchange, you want to defer 100% of your capital gains taxes. But in order to do that you need to make sure that the replacement property you’re exchanging into is greater in value, equity, and debt compared to your relinquished property. Otherwise you may only be able to defer some of your gains.

Start Your 1031 Exchange Journey Today

Start your 1031 exchange journey today with one of the qualified intermediaries from CPEC1031, LLC. Our company has over two decades of experience working with clients on their like-kind exchanges. We have the knowledge and experience to work with you through every stage of the 1031 exchange process and make sure you are able to defer all of your capital gains tax burden. Reach out to the team at CPEC1031 today to learn more about the benefits of 1031 exchanges and get started with your next like-kind exchange of real estate.

• 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.

© 2024 Copyright Jeffrey R. Peterson All Rights Reserved

Consider These Questions Before Starting a 1031 Exchange

There are many things to consider in a 1031 exchange, but before you begin the process, you need to ask yourself a few basic questions. In this article, we are going to walk through a few questions to consider before starting your 1031 exchange of real estate.

Does Your Property Qualify for 1031 Exchange?

The first question you need to ask yourself is: “does your property qualify for 1031 exchange?” This question is important because some property is not eligible for 1031 exchange treatment. Personal property is excluded outright. Only real property is eligible for 1031 exchange. But not all real property qualifies either. Only real property held for investment or business use is eligible. That means if you are holding your real property for personal use, you won’t be able to use it in a 1031 exchange.

What Replacement Property Do You Intend to Exchange Into?

It’s also important to think about what type of replacement property you want to exchange into. You have only 180 days to complete the exchange once you begin, so it’s important to get a jump on the process and start thinking about your replacement property beforehand so you have plenty of time.

We’re Here to Help You Through the 1031 Exchange Process

The qualified intermediaries at CPEC1031, LLC are here to help you through the 1031 exchange process. Let our team of professionals help you with all the details surrounding your like-kind exchange of real estate. Contact us today to learn more about the process of conducting a 1031 exchange and see how you can benefit from 1031 tax deferral. Our office is located in downtown Minneapolis but we work with clients throughout the entire state of Minnesota, as well as the United States as a whole.

• 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.

© 2024 Copyright Jeffrey R. Peterson All Rights Reserved

Capital Gains Tax Options When Selling Investment Real Estate

When you sell a piece of investment real property, you have several options to consider when it comes to capital gains taxes. In this article, we are going to outline some of your options for dealing with capital gains taxes when selling investment real estate.

Pay the Capital Gains Taxes in an Outright Sale

The simplest and least tax-advantageous option at your disposal is to simply sell the investment property in an outright sale. This is often the easiest method, but it triggers a capital gains tax burden that can be quite hefty depending on the details of your transaction.

Defer the Capital Gains Taxes via a 1031 Exchange

If you want to sell your investment property but are hesitant to pay a large capital gains tax bill, then a 1031 exchange may be the best option for you. A like-kind exchange is often the most tax-advantageous method for selling investment real estate as it allows you to defer your capital gains tax burden so long as you reinvest all of your net proceeds from the sale into a like-kind replacement property.

1031 Exchanges – Great Vehicles for Tax Deferral

1031 exchanges are great vehicles for tax deferral when selling real estate that qualifies for like-kind exchange treatment. Before you begin the process, you need to make sure that your property is a good fit for a like-kind exchange. A qualified intermediary is an excellent resource who can answer all of your questions about 1031 exchanges and help ensure you can defer 100% of your capital gains taxes. CPEC1031 intermediaries have more than two decades of experience doing just that. Reach out to us today at our downtown Minneapolis office to learn more about how we can help you through the 1031 exchange process.

• 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.

© 2024 Copyright Jeffrey R. Peterson All Rights Reserved