Recently, I joined the Federation of Exchange Accommodators (FEA) in Washington, D.C. to meet with lawmakers and advocate for the continued preservation of I.R.C. Section 1031.
These conversations matter.
Section 1031 has been part of the tax code for more than 100 years because it does more than benefit individual investors. It helps capital move more efficiently throughout the economy. It encourages reinvestment, improves real estate assets, creates jobs, and supports long-term economic activity in communities across the country.
A healthy 1031 exchange environment:
Reduces the “lock-in effect” that keeps investors from reinvesting capital
Keeps real estate markets active and capital moving
Supports redevelopment, upgrades, and better use of property
Fuels jobs across construction, lending, brokerage, legal, and related industries
Encourages investment in housing, commercial real estate, and infrastructure
Like many areas of tax policy, Section 1031 is often revisited during tax policy discussions. While proposals and headlines can create uncertainty, the reality is that like-kind exchanges have consistently remained part of the tax code because of the important role they play in the economy.
Without Section 1031, many investors would simply hold properties longer rather than reinvest. That can reduce transaction activity, slow redevelopment, limit property improvements, and ultimately create stagnation in portions of the real estate market. Fewer transactions can also mean less economic activity for the many industries connected to real estate. In fact, studies by Ernst & Young and Ling & Petrova show that eliminating Section 1031 would likely slow economic activity more than it would increase tax revenue.
That is why organizations like FEA continue to advocate for thoughtful policy and educate lawmakers on the broader economic benefits of 1031 exchanges.
I’m proud to support those efforts and to continue helping investors navigate strategies that preserve flexibility, encourage reinvestment, and support long-term growth.
To learn more about the economic impact of 1031 exchanges and the industry advocacy efforts, visit https://www.1031.org
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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