Some of the most common questions people have about 1031 exchanges fall under the category of “where?” In other words, many people wonder if their 1031 exchange properties need to be located in the same geographic location (city, state, etc.) In this article, we are going to talk about whether or not your 1031 relinquished and replacement properties need to be in the same geographic area in a like-kind exchange transaction.
1031 Exchanges Are Nationwide
1031 exchanges work with like-kind property across the United States. When it comes to geography, the only thing you need to make sure of is that your properties are located in the United States. Foreign property does not qualify for 1031 treatment, but property in the US works, so long as it satisfies all the other requirements of a like-kind exchange.
Diversification Into Different Markets
Exchanging into and out of property in different cities and states is actually quite a common practice among investors. Some choose to move into different states for economic reasons (perhaps they want to move to a more tax-friendly state, or into a stronger real estate market), while others do so for more personal reasons (perhaps they’re retiring and moving to a different state).
Like-Kind Exchanges of Investment Real Estate
Find a qualified intermediary to help you through the 1031 exchange process by contacting CPEC1031, LLC. Our team is ready to help you through all the details surrounding your like-kind exchange of investment real estate. Whether you’re a seasoned investor or this is your first time dipping your toes into the 1031 exchange waters, we’re here to guide you through the process. Reach out to us today at our Minneapolis office and learn more about how you can benefit from a like-kind exchange of investment real estate.
Start Your 1031 Exchange: If you have questions about 1031 exchanges, feel free to call me at 612-643-1031.
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