Since roughly 1921, the Internal Revenue Code has contained provisions that defer the recognition of gain. It was originally conceived of as a situation in which you’re trading or swapping property. Since you’re not cashing out in this situation, but rather continuing your investment in other property, that was viewed as a fair tax deferral.
When this provision was introduced, it was shortly after World War I and the United States was in debt. The country needed to stimulate the economy. This predecessor to the 1031 exchange came into the code at a time when Congress was trying to move capital to the most advantageous place because they wanted to encourage investment and created jobs. This highlights another great advantage of the 1031 exchange – it’s great for moving capital throughout the economy. It’s like water going through a mountainside – it’s going to get to the mountain somehow, and it’ll get there faster if it’s not impeded.
1031 Exchange Services in Minnesota
CPEC1031, LLC offers 1031 exchange services throughout Minnesota and the United States as a whole. Our team consists of skilled 1031 exchange accommodators who are here to help you navigate the waters of section 1031 of the Internal Revenue Code. We have decades of experience working with clients across the country on all types of 1031 exchanges of real property. Give us a call to get more information about the benefits of section 1031 and see if your property is eligible for 1031 tax deferral.
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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