What is a 1031 Exchange?
A 1031 Exchange allows you to defer your taxes on money you make from selling an investment or income producing property by reinvesting in another investment or income producing property and is made possible by Section 1031 of the Internal Revenue Code.
Property Qualifications
If you own a business or investment property and want to perform a 1031 Exchange, you must find another business or investment property you would like to exchange. The Internal Revenue Code states that the properties involved in an exchange must be "like-kind." This can be confusing to the real estate investor, but almost any real property that is not a personal residence or second home may qualify as "like-kind." For example, you may exchange your rental home for a warehouse building or for a duplex or a fourplex. One property may be exchanged for several properties, or several properties can be exchanged for one. To be sure your property qualifies, you should consult your tax or legal advisor.
Timeline
The Internal Revenue Code provides 180 days for the investor to complete a simple, forward real estate exchange (there are other forms of 1031 Exchanges which are more complex and you should discuss these with your tax or legal advisor). The clock starts ticking as soon as the property you are selling closes. Once your property is sold, the investor has 45 days to identify potential replacement properties and a replacement property must be acquired on or before the 180th day.
Qualified Intermediaries
Perhaps the most important step in a 1031 Exchange is identifying a Qualified Intermediary (QI). A QI holds the funds of the sale of your property until the transaction for the purchase of the replacement property is ready to close. That being said, you must find a QI that you trust and that is both bonded and insured.
Below are some qualified intermediaries that may be able to assist you in a 1031 Exchange.
Land America 1031 Exchange Services
George Barlow, Esq.
Senior Account Executive
2651 N. Harwood St., Suite 260
Dallas, TX 75201
Toll Free (866) 377-1031
Cell (214) 675-1031
E-Mail
This e-mail address is being protected from spambots. You need JavaScript enabled to view it
Website www.landam1031.com/southwest
WaMu 1031 Exchange
3601 N. Aviation Boulevard, Suite 1000
Manhattan Beach, CA 90266
Phone (800) 966-1031
Website www.wamu1031.com
The 1031 Exchange Experts
8101 East Prentice Avenue, Suite 400
Greenwood Village, CO 80111
Toll Free (866) 694-0204
Website www.expert1031.com
How We Can Help
We at GMAC Real Estate Fredericksburg have helped both buyers and sellers achieve successful 1031 Exchanges and are willing and able to put that expertise to use with yours. We know that when you are performing a 1031 Exchange, you are on a strict, no exceptions timeline and we will diligently work with you to not only identify your potential replacement properties, but to close on one of those properties before the time runs out.
Contact us today if you are considering or are in the process of a 1031 Exchange and need expert assistance in locating a replacement property in or around Fredericksburg.
The information contained herein is for informational purposes only and does not constitute tax, legal or accounting advice. You are advised to seek appropriate professional advice regarding your particular facts and circumstances.
|
Our Services 
