1031 Exchange

For many investors, selling a business or real estate property for a significant profit is an ideal scenario.  However, the tax consequences of such a sale can be substantial. Fortunately, in qualified situations, Section 1031 of the Internal Revenue Code can provide investors with relief from the high tax burdens associated with selling appreciated or fully depreciated property.

The 1031 exchange process enables investors to defer capital gains taxes by reinvesting sales proceeds into another similar investment property. By doing so, investors not only defer the tax gain from the sale, but also benefit from the depreciation expense recaptured on the property received. 

The process established by the IRS for a 1031 exchange is very structured and rigid. We assist our clients throughout the process. The first step is to explore available options. In some cases, it may be more advantageous to offset taxes using other investments. It is imperative that investors who choose to utilize the 1031 provisions have qualified and experienced professionals to assist in the process.