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A Section 1031 Exchange is a tax-deferment strategy that allows you to defer paying taxes on the sale of an investment property by reinvesting the proceeds from the sale into a similar "like-kind" property. By deferring taxes, you have more money to reinvest, potentially leading to greater returns on investment.
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Why utilize a Section 1031 Exchange?
• Tax deferral: By deferring capital gains taxes, you can reinvest the full sale proceeds into a new property, allowing for potentially greater returns on investment.
• Increased buying power: By deferring taxes, you have more buying power to acquire a higher-valued property.
• Portfolio diversification: Section 1031 Exchanges allow you to diversify your portfolio by exchanging a property in one location for one in another location, or exchanging a single property for multiple properties.
• Estate planning: Upon the death of the property owner, the tax basis of the property is stepped up to its current market value, which means that any deferred capital gains tax is eliminated for the property heirs.
The benefits of utilizing a Section 1031 Exchange are numerous, and we’re here to help you take advantage. Our experts can help you navigate the regulations surrounding the exchange process, as well as facilitate the transaction to ensure compliance with IRS guidelines.