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1031 ExchangesWhat is a 1031 Exchange?Now with the recognition of TICs by the IRS, you can now exchange into a TIC position in an institutional grade property.Under the Internal Revenue Code, Congress requires the recognition of taxable income on any sale or exchange that is not specifically exempted from taxation. A 1031 tax-deferred exchange offers real estate owners one of the last great tax advantages. Through Section 1031 of the Internal Revenue Code, Congress states that a real property owner may delay the capital gains tax on the sale of their property by taking the money from the sale of their property and reinvesting the proceeds into ownership of any like-kind exchange property. Should I Consider a 1031 Exchange?If you are in a position to make a net gain on the sale of your property then you are exactly the person to consider a 1031 exchange. Take your gain from that sale and exchange it into another property while simultaneously avoiding the capital gains tax otherwise incurred on that money. Thus giving you more money to be invested which can provide a higher cash flow.
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