1031 Real Estate Exchange Information

1031 Real Estate Exchange

A 1031 real estate exchange is a legal method by which a property owner disposes of one property and acquires another without having to pay any capital gains tax on the transaction. In an ordinary sale transaction, the property owner is taxed on any gain realized by the sale of the property. In a 1031 real estate exchange, the tax on the exchange is deferred indefinitely.

How does a QI help with a 1031 real estate exchange?

An intermediary can guide you through the IRS's regulations, making a 1031 real estate exchange easy, inexpensive, and safe. You should also consider having your accountant and/or attorney review any real estate transaction. A good QI will prepare all the documents necessary for closing on your property within a 1031 exchange, "safe harbor" your proceeds in a trust account set up in a secure bank specifically for your proceeds, keeping you in compliance with the IRS 1031 code, and then handle the closing of your replacement property(ies) with all documents and accounting necessary to comply with the code. The upon closing, the property will revert to the taxpayer and the services of the QI should be finished.

Please email us at info@realtynetadvisors.com to receive a 24-page pamphlet entitled "Section 1031¬Tax Deferred Exchanges in a Nutshell."