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order for a transaction to qualify for tax deferred treatment under Section
1031, certain requirements must be met, including: A. Qualified Property Some types of property are specifically disqualified, namely: stock in trade or other property held primarily for sale; securities or evidences of indebtedness or interest; interests in a partnership or multi-member limited liability company; certificates of trust or beneficial interest; and choses in action (i.e. interests in law suits). B. The Purpose Requirement Both the relinquished property and the replacement property must be held for productive use in a trade or business or for investment. The taxpayer cannot exchange into or out of the taxpayer’s own primary personal residence, or property held for resale as a dealer. C. The Like-Kind Requirement Replacement property acquired in an exchange must be “like-kind” to the property being relinquished. All real property is like-kind: Raw land may be exchanged for land with a building. One property may be exchanged for more than one property. However, personal property, like a primary residence, is not like-kind to real property. D. The Holding Period If a replacement property is acquired and then immediately sold, this may indicate that it was acquired for resale and cannot qualify for tax deferred treatment. CLICK FOR MORE RULES & REGS > > > |
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| EXCHANGES PERFORMED NATIONWIDE : 1 800 500 1031 : LOCAL OFFICES IN SANTA FE & TELLURIDE : INFO@A1031EXCHANGE.COM |
The information on this website is an educational resource only, and not intended
as legal, accounting, or tax advice of any kind.
It is recommended that you consult with your own attorney or tax advisor for
details before choosing to engage in a 1031 Exchange