When you’re thinking about doing a 1031 exchange, there are two parts to the initial litmus test that you must satisfy:
The exchange must be for like-kind property.
The property involved must be held for a qualifying purpose.
Like-kind generally is very broad. Real estate is generally considered like-kind to other real estate. You can exchange the Empire State Building for a condominium in Naples, FL.
But what are some situations in which real estate may not be considered like-kind?
Leasehold estates of less than 30 years are not considered like-kind in the realm of 1031. This comes up when dealing with hangars at municipal airports, which are typically on 10 year leases.
Additionally, certain oil and gas rights are like-kind and some are not. You might need to hire a tax attorney to give you an opinion on whether your specific oil and gas interests qualify for 1031.
Work with a Qualified Intermediary on Your Next Like-Kind Exchange
Work with a qualified intermediary from CPEC1031, LLC on your next like-kind exchange of investment real property. Our team has been facilitating 1031 exchanges across the United States for decades. We can help you with your forward exchange, reverse exchange, or build-to-suit construction exchange. Reach out to us today at our Twin Cities office (located in downtown Minneapolis) to learn more about the tax saving power of section 1031 and see if your property qualifies. Our intermediaries are standing by to discuss your situation.
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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