1031 Exchanges
We are able to represent our investor clients who choose to engage in 1031 Like-Kind Exchanges. As with any transaction of this nature it is important to first seek the advice of a competent tax professional. Simply stated, a 1031 Like-Kind Exchange enables an Investor to sell a property and use the sale proceeds to purchase a replacement property of “Like- Kind”. The property sold must have been held for investment. Under IRS Section 1031 a qualifying transaction may allow an Investor to defer (not avoid) the payment of taxes on the gain.
The strict timelines in place must be followed to obtain favorable tax treatment under Section 1031. Prior to the contract for sale being executed, the Investor must establish the 1031 structure. We can prepare these documents and walk you through the process. Once the initial property has been sold, the Investor then has 45 days in which to identify the Replacement Property or Properties. The purchase and closing of the Replacement Property must occur within 180 days of the sale date of the previously owned property.
We can prepare the needed documentation as well as serve as your Qualified Intermediary (Q.I.). In that role we retain your sales proceeds in escrow and then deliver them to the closing when the Replacement Property is purchased. Again, competent tax advice is essential to fully utilize the advantages of a 1031 Like Kind Exchange but our office can facilitate this transaction from document preparation, to holding the sale proceeds all the way to closing on the Replacement Property.
If you have questions or wish to discuss this further, please feel free to contact an experienced attorney at the link below.