In a 1031 exchange, you need to hold your like-kind property with a “qualified purpose.” But what does that mean?
Qualified Purpose
A qualified purpose means that you are holding the property either as an investment or for use in your trade or business. This means that you cannot do a 1031 exchange on your family home because this family home is being held primarily for personal use.
To avoid making a costly mistake before you sell, you should make the proper arrangements with an experienced qualified intermediary first so that the transaction is treated as a trade or exchange (rather than a sale and repurchase) to be sure that you qualify for maximum tax savings. Often deals are done informally without much of a contract or closing; a good QI can help add-back in the structure to make the deal work.
1031 Exchange Services
At CPEC1031 LLC, we work with clients across the United States on 1031 exchanges of all types. Our team of qualified intermediaries has over twenty years of experience and can help you through the details of your like-kind exchange. Contact us today to learn more about our extensive services and see how we can help. You can find us at our primary office located in downtown Minneapolis.
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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