Video – Alternative Products You can 1031 Exchange Into

Many people ask about the variety of different replacement property options that are available in a 1031 exchange and what exactly constitutes “like-kind” in the realm of real estate.

If you’re exchanging a duplex can you exchange into something completely different such as an oil and gas program? In fact there are 1031 compliant oil and gas programs that you can exchange into. There are also tenant-in-common arrangements that you can exchange into, as well as Delaware Statutory Trusts (DSTs), some of which convert into a 721 contribution of the underlying real estate into an UPREIT. So there’s a great variety of different products that you can 1031 exchange into.

One of the common themes with all of these options is that they are passive investments that allow you to work smarter, not harder.

1031 Exchange Services

A 1031 exchange is a powerful vehicle for tax-savings for owners of investment real estate. Under section 1031 of the Internal Revenue Code, you are allowed to defer capital gains taxes on the sale of qualifying real property when you reinvest your net proceeds into like-kind replacement property. Once you begin the process you must complete everything within 180 days so it’s important to adequately prepare. The best way to set yourself up for success is to coordinate with an experienced 1031 intermediary at CPEC1031, LLC.

• 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.

© 2025 Copyright Jeffrey R. Peterson All Rights Reserved

Video - 1031 Exchange Tips for Tax Season

If you recently completed a 1031 exchange and you need to report it to the IRS, you may need to assemble some information to allow your tax preparer to put together everything required to file your federal tax return.

Your tax preparer will need to fill out form 8824, which is essentially a worksheet that helps the IRS connect the dots between the properties that were sold and received during the 1031 exchange. This form requires a lot of information. Here’s some of the information you can assemble and provide to your taxpayer in advance of the tax filing deadline:

• If you used a qualified intermediary, you may have received a closeout or summary letter that provides all of the critical dates and explains how your exchange funds were utilized.

• As to the relinquished property, you can provide a pdf copy of the final signed closing statement that summarizes how the monies were spent.

• Provide the deed or conveyance document that was used to convey the ownership of the property to the purchaser.

• If you received a 1099-S, this is another great document to provide your tax preparer.

• Once you sold your relinquished property, you may have identified your replacement property within the 45 day identification period. If you did, you’ll want to provide a copy of that identification form to your tax preparer together with proof that it was timely sent to the recipient.

• When you closed on your replacement property, you probably had a closing statement showing the funds coming in, the purchase price, the closing date, and various transactional expenses. This is a great thing to provide your tax preparer as well.

• Sometimes, mistakes happen during closings and they need to be corrected. If you received a corrected document after closing, that’s important to give to your accountant so they’re working with updated information.

1031 Exchange Help

CPEC1031, LLC offers qualified intermediary services for taxpayers considering a 1031 exchange of real estate. A like-kind exchange is a great way to defer capital gains taxes on the sale of real estate by continuing your investment into a bigger replacement property. In order to defer all of your gains, you need to abide by the rules set out by section 1031 of the Internal Revenue Code. Work with a qualified intermediary on your exchange to ensure that you meet all the required benchmarks. Reach out to the intermediaries at CPEC1031, LLC today to see if a 1031 exchange is right for you!

• 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.

© 2025 Copyright Jeffrey R. Peterson All Rights Reserved

Video – 1031 Exchanges Involving A Non-Titled Spouse

Let’s say you bought a property before marriage and you own it in your own individual name. Twenty years later it’s appreciated a lot in value. Now that you’re doing a 1031 exchange, how do you deal with the fact that your non-titled spouse may want to be on the title to the replacement property? The same taxpayer requirement says that the taxpayer that owns the relinquished property needs to acquire the replacement property. All of the exchange funds for that taxpayer need to be used exclusively to purchase that taxpayer’s interest in the replacement property.

This can be a tricky dynamic to deal with during a 1031 exchange. If you want your spouse to be in title with you, it may be best to add cash for that spouse’s proportionate share of the property because your exchange funds need to be used for your proportionate share of the purchase. This is also a question that can be complicated by whether or not you (or the property) reside in a community property state, such as Texas, Wisconsin, etc.

When you have these questions it’s good to surround yourself with a good accountant, attorney, and qualified intermediary.

Talk with a Qualified Intermediary

Talk with a qualified intermediary at CPEC1031, LLC today about your next 1031 exchange today. Our team of skilled intermediaries has been facilitating exchanges under section 1031 of the Internal Revenue Code for more than two decades. We can help you navigate the process and find the answers you’re looking for. Contact us today at our downtown Minneapolis offices to learn more.

• 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.

© 2025 Copyright Jeffrey R. Peterson All Rights Reserved

Video – Transactional vs. Operational Expenses in a 1031 Exchange

In order to get your relinquished property sold, you had to spend some money to repair it and get it ready. Can you recoup those outlays that you made to fix up the property before its sale?

Generally, in a 1031 exchange you can only siphon off money to pay transactional expenses that are necessary like a real estate commission, state deed tax, recording fees, etc. Repair expenses are usually considered operational expenses. As a result, you probably don’t want to reach into the cookie jar for reimbursement of your operational expenses.

The only exception to that rule would be a situation in which the buyer extracts a concession from the seller in the purchase agreement that requires a certain repair as a material factor of the contract. In that case, the expense may be a transactional expense because it’s a requirement of the sale contract. This may also depend on how the concession is written in the contract so you need to surround yourself with a great team including your tax preparer, your real estate agent, and your qualified intermediary.

1031 Exchange Questions, Answered

Get all of your 1031 exchange questions answered by reaching out to a qualified intermediary at CPEC1031, LLC. We have more than twenty years of experience working on exchanges of real property under section 1031 of the Internal Revenue Code. We are here to help guide you through all the details of your next 1031 exchange and do everything possible to defer 100% of your capital gains tax burden.

• 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.

© 2025 Copyright Jeffrey R. Peterson All Rights Reserved

Video – Consolidating Multiple Relinquished Properties into a Bigger Replacement Property

Let’s talk about consolidation. If you’re selling multiple relinquished properties in a 1031 exchange, can you take the proceeds from numerous sales and combine them together to buy one bigger replacement property?

The answer is yes. However, this comes with two challenges.

1. The logistics of trying to herd all of your cats together for those multiple sales to occur, thus allowing you to assemble your capital for the big purchase.

2. Accounting issues. You need to make sure that the replacement property is valued large enough that it can accommodate the proceeds from multiple sales. Generally you want the replacement property to be at least equal if not greater in value than the amounts realized from the multiple relinquished properties. Those amounts realized are the gross sale prices minus the transactional expenses such as commissions, recording fees, and other things that reduce the profit on the sale.

Remember, you can do a 1031 exchange to acquire a bigger and better property but you have to work out the logistics and accounting.

CPEC1031, LLC – Start Your Like-Kind Exchange

Start your like-kind exchange with CPEC1031, LLC today. We have more than two decades of experience working with clients throughout the United States on their 1031 exchanges. We facilitate exchanges of all types – from duplexes, to retail spaces, to large office buildings. As long as you own property held primarily for investment or business purposes you can benefit from a 1031 exchange. Contact our office today to set up a time to chat about the many benefits of section 1031 and how you can begin the process.

• 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.

© 2025 Copyright Jeffrey R. Peterson All Rights Reserved