Section 1031 Exchange Explained

Internal Revenue Code allows a real estate investor of commercial real estate to exchange commercial real estate and defer paying federal and state capital gain taxes (20%+ applicable state taxes) in the event that they purchase a like-kind commercial real estate. A tax-deferred exchange is a method by which a real estate investors trades one or more relinquished commercial real estate for one or more replacement commercial real estate of like-kind, while deferring the payment of federal income taxes and some state taxes on the transaction.

Completing a section 1031 exchange with a tenancy in common interest ownership in a commercial real estate allows real estate investors not only to defer their capital gains taxes, but to also upgrade their commercial real estate into larger, institutional-grade commercial real estate. Essentially, section 1031 exchanges allow real estate investors to use all of the proceeds from their sale as leverage to gain access to more valuable commercial real estate.

If you are thinking of transferring any commercial real estate, contact us today for more information on section 1031 exchanges.

Benefits of a Section 1031 Exchange

Several benefits befall any section 1031 exchange real estate investor, including:

Section 1031 Exchange Benefits

Deferred capital gains taxes

Section 1031 Exchange Benefits

Increased cash flow on a monthly basis is a strong possibility

Section 1031 Exchange Benefits

More money to put as a down payment on your new commercial real estate

Pick and choose the type and location of the replacement commercial real estate that best suites you

Section 1031 Exchange Benefits

Do away with the struggles of traditional commercial real estate management

Section 1031 Exchange Benefits

Achieve your investment objectives

Section 1031 Exchange Benefits

The tax dollars saved through a section 1031 exchange may be maximized to increase cash flow and overall net worth.

Section 1031 Exchange Benefits

Consolidate your investment portfolio by electing a tenancy in common exchange

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