Library

1031 Exchange Library

• 1031 Like-Kind Exchange Pitfalls to Avoid
  by Greg Lehrmann, Attorney Double Board Certified • Commercial and Residential Real Estate Law Share the articles to your socials! The Big Picture Internal Revenue Code Section 1031 and its accompanying regulations impose strict procedural and documentation requirements that must be satisfied to qualify for deferral. A taxpayer’s good faith intent to reinvest in replacement… Read more: 1031 Like-Kind Exchange Pitfalls to Avoid
• Building on Your Own Property in a 1031 Exchange
  by Greg Lehrmann, Attorney Double Board Certified • Commercial and Residential Real Estate Law The Big Picture Sometimes a taxpayer wants to sell a property and use the exchange proceeds to construct improvements on a property “they” already own as part of a §1031 exchange. The quotation marks around “they” are intentional—because in a 1031… Read more: Building on Your Own Property in a 1031 Exchange
• Can Foreign Investors Use 1031 Exchanges?
  by Greg Lehrmann, Attorney Double Board Certified • Commercial and Residential Real Estate Law Share the articles to your socials! The Big Picture Because Section 1031 of the U.S. Tax Code qualifies the property, not the person, foreign investors are not disqualified from using this section of the tax code. In other words, neither the… Read more: Can Foreign Investors Use 1031 Exchanges?
• Closing Costs
  by Greg Lehrmann,Attorney Double Board Certified • Commercial and Residential Real Estate Law The Big Picture Under Section 1031, some items on a real estate closing settlement statement are considered “exchange expenses”, some are not, and some are uncertain. Why It Matters When a taxpayer implements a 1031 exchange, any cash received by the taxpayer… Read more: Closing Costs
• End of Year 1031 Exchange tax Considerations
  by Greg Lehrmann, Attorney Double Board Certified • Commercial and Residential Real Estate Law The Big Picture Section 1031 exchanges help real estate investors defer taxes by reinvesting property sale proceeds into new property. Strategies to maximize tax savings may differ depending upon the time of the year that the exchange occurs. Because exchanges occurring… Read more: End of Year 1031 Exchange tax Considerations
• Farm & Ranch Exchange, Part II
  by Greg Lehrmann, Attorney The Big Picture As discussed in a prior newsletter “Farm and Ranch Exchanges, Part 1,” the 1031 exchange offers a powerful tax deferral strategy for those selling farms or ranches. We discussed “split treatment” transactions whereby sellers leverage Section 1031 with Section 121 for the sale of the primary residence on… Read more: Farm & Ranch Exchange, Part II
• Farm & Ranch Exchanges, Part I
  by Greg Lehrmann, Attorney The Big Picture The 1031 exchange, a cornerstone of the tax code since 1921, offers a powerful tax deferral strategy for those selling farms or ranches. This provision allows property owners in the agriculture sector to defer capital gains taxes by reinvesting the proceeds from a sale into so-called “like-kind” real… Read more: Farm & Ranch Exchanges, Part I
• Improvement Exchanges
  by Greg Lehrmann, Attorney Double Board Certified • Commercial and Residential Real Estate Law The Big Picture The tax code allows an exchanger to add improvements to a desired replacement property. The structure that permits this is called an “improvement exchange.” Why it Matters The Process The 1031 qualified intermediary creates a special purpose entity,… Read more: Improvement Exchanges
• Non-Safe Harbor Parking Arrangements: More Than 180 Days May Be Allowed
  by Greg Lehrmann, Attorney Double Board Certified • Commercial and Residential Real Estate Law The Big Picture 1031 exchanges provide a tax strategy for investors to reinvest proceeds from a sale of investment property into replacement property. When these exchanges were first authorized in 1921, it was thought that landowners had to simultaneously exchange the… Read more: Non-Safe Harbor Parking Arrangements: More Than 180 Days May Be Allowed
• Oil & Gas Exchanges
  by Greg Lehrmann,Attorney Double Board Certified • Commercial and Residential Real Estate Law The Big Picture Section 1031 of the US Tax Code provides that no gain is taxed when real property held for business or investment is exchanged for other real property held for business or investment. That is, so long as certain procedures… Read more: Oil & Gas Exchanges
• Partial Exchanges
  by Greg Lehrmann, Attorney The Big Picture—What is a Partial 1031 Exchange? • Some taxpayers believe that they must “buy up” (spend all the equity from their sale by purchasing a more expensive property) to defer taxes with a 1031 exchange. • However, taxpayers may choose to defer some, but not all, capital gain taxes… Read more: Partial Exchanges
• Partnerships & 1031 Exchanges
  by Greg Lehrmann, Attorney Big Picture Like any taxpayer, a partnership (including a limited liability company taxed as a partnership) can engage in a like- kind exchange under IRC Section 1031 to defer paying tax on capital gains. Difficulties may arise, however, when the individual partners desire different outcomes with regard to the sale of… Read more: Partnerships & 1031 Exchanges
• Post-July 4th Exchanges Present More Options
  by Greg Lehrmann, Attorney Double Board Certified • Commercial and Residential Real Estate Law The Big Picture Section 1031 exchanges help real estate investors defer taxes by reinvesting property sale proceeds into new property. Exchanges occurring in the second half of the calendar year often span two tax periods. This phenomenon provides more decision points… Read more: Post-July 4th Exchanges Present More Options
• Requirements for Full Tax Deferral
  by Greg Lehrmann, Attorney Double Board Certified • Commercial and Residential Real Estate Law The Big Picture—Deferring All Tax in a 1031 Exchange Some taxpayers performing a 1031 exchange incorrectly assume that they are only required to invest their gain in order to defer all tax. This is an invalid assumption. Gain is defined as… Read more: Requirements for Full Tax Deferral
• Select Issues with 1031 Exchanges
  by Greg Lehrmann, Attorney Double Board Certified • Commercial and Residential Real Estate Law Share the articles to your socials! Share the articles to your socials! Scan for a script on how to mention 1031 Exchanges to potential clients About us: Greg Lehrmann is the founding member of Excel 1031 Exchange with 42 years of… Read more: Select Issues with 1031 Exchanges
• The Big Tradeoff
  by Greg Lehrmann, Attorney Double Board Certified • Commercial and Residential Real Estate Law The Big Picture Placing funds with a qualified intermediary (QI) gives taxpayers an opportunity to preserve and build wealth, change the location and type of property owned, increase cash flow, and reduce management responsibilities. These benefits are enormous, but with these… Read more: The Big Tradeoff
• Turning Land and Buildings into “Mailbox Money”
  by Greg Lehrmann,Attorney Double Board Certified • Commercial and Residential Real Estate Law From an economic standpoint agricultural or undeveloped land produces a small amount of cash flow, if any, as a percentage of the fair market value of the property. Rental property produces more income, but along with this cash comes toilets, trash, tax,… Read more: Turning Land and Buildings into “Mailbox Money”