You can do a 1031 exchange of US property for US property. You cannot do a 1031 exchange of foreign property for US property. Strangely you can also do a 1031 exchange of foreign property for foreign property. Let’s say that you own commercial real estate property in New Zealand, and you want to sell that property and purchase a new property in Australia. You can do a 1031 exchange with those properties. You might ask, “why would I bother doing a 1031 exchange in this situation?”
Remember, US taxpayers are taxed on their income regardless of where it’s derived. Even if your income is derived from a foreign real estate transaction, you must pay taxes on that transaction in the United States. A 1031 exchange can help you defer those taxes.
Defer Your Capital Gains Taxes by Reinvesting Your Proceeds
A 1031 exchange under section 1031 of the IRC allows you to defer capital gains taxes by reinvesting the sales proceeds into a like-kind replacement property of equal or greater value. This is an extremely powerful tax tool used by big and small investors alike! Anyone can avail themselves of the tax-saving benefits of the 1031 exchange. To get your exchange rolling, contact a qualified intermediary at CPEC1031, LLC today. We can explain the like-kind exchange process to you, answer any of your questions, and guide you through each stage.
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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