Finding the right replacement property is one of the most difficult parts of a 1031 exchange. In this article, we offer up a few tips for finding the right replacement property for your 1031 exchange.
Explore Different Geographic Areas & Industries
One of the great things about a 1031 exchange is that you can exchange out of and into properties in completely different geographic areas. You can sell a relinquished property in Minnesota and purchase a replacement property in Arizona (so long as they are both like-kind properties held for investment or business use). This also applies to different industry segments. You can exchange between retail property, rental property, DSTs, and more!
Consider a Reverse Exchange
If you’re having trouble locking down a replacement property in a hot seller’s market, consider doing a reverse 1031 exchange. While a forward exchange requires you to sell your relinquished property first, a reverse exchange allows you to pick up your replacement property first. You still need to complete the process within your 180 day exchange period, but this allows you to nail down a replacement property early in the process.
1031 Exchange Services
CPEC1031, LLC offers 1031 exchange services to taxpayers throughout the state of Minnesota and across the United States. We can help guide you through the 1031 exchange process, no matter how complex your transaction might be. With over two decades of experience, we have the skills and expertise to help ensure your capital gains tax deferral under section 1031 of the Internal Revenue Code. Contact our team today to set up a time to chat about your 1031 exchange. We can answer all of your questions and help you understand the various rules and requirements of a 1031 exchange of real estate.
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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