Deferring Tax with a Reverse 1031 Exchange

reverse 1031 exchange

In today's marketplace it's really easy to be a seller because it’s a hot seller's market. There's a lot of people competing for the same replacement properties particularly in certain segments of the market like multi-family apartments. Here's where a reverse exchange can help you solve the problem of how to align your relinquished property with your replacement property. 

How a Reverse Exchange can Help

Step one is do a reverse exchange, find the replacement property first since that's the harder task lock it up with a purchase agreement and if necessary you can close on it having your qualified intermediary form a new LLC and that LLC acts as a straw man purchaser and temporarily holds title to the replacement property for up to 180 days until you then later sell the relinquished property.

So the beautiful thing is once you've sold your relinquished property it's really easy to complete your exchange because your replacement property is waiting for you on the shelf and we just take that replacement property off the shelf and transfer it to you to complete the exchange.

The Problem

The problem is that it's hard to find replacement properties the opportunity is to use a reverse exchange to lock in a sure thing so that you know with certainty you have your replacement property waiting for you at the end of this process.

  • 1031 Hotline: If you have questions about reverse 1031 exchanges, feel free to call me at 612-643-1031.

Defer the tax. Maximize your gain.


© 2016 Copyright Jeffrey R. Peterson All Rights Reserved