1031 exchanges of real estate offer taxpayers a tremendous opportunity to defer their capital gains taxes when selling investment property. But in order to successfully defer the gain on the sale of a property, you have to satisfy certain rules and benchmarks. In this article, we are going to walk through these requirements and offer tips for making your exchange a success.
1031 Exchange Time Deadlines
You only have a total of 180 days to complete your 1031 exchange after you start the process. The process officially begins when you sell your relinquished property. Then you have 180 days to identify and close on your replacement property. There is also a 45 day identification deadline that begins when your 180 day exchange period begins. During that 45 days, you must identify in writing the replacement properties that you want to use in your 1031 exchange. Failure to hit these deadlines will result in a failed 1031 exchange.
Qualified Purpose
You also need to make sure that all property in a 1031 exchange is held for a qualified purpose. 1031 exchanges can only be done with property that is held for investment or business use. Your family home that you use as a primary residence will not qualify for 1031 exchange treatment.
Minnesota 1031 Exchange Qualified Intermediaries
The Minnesota qualified intermediaries at CPEC1031, LLC have over two decades of experience working on like-kind exchanges of all shapes and sizes. With our extensive experience, we can walk you through the many details of your next real estate exchange and ensure you are able to defer your capital gains taxes. Contact us today at our main offices located in downtown Minneapolis to learn more about our services and how we can help with your next 1031 exchange!
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.
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