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1031 Exchange and Real Estate Investment Opportunites
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If you, as an investor, sell appreciated property, you will pay a tax. However, property that qualifies for preferential tax treatment under Internal Revenue Code Section 1031 (IRC 1031) is treated quite differently. This states “ No gain or loss shall be recognized if property held for productive use in trade or business or for investment purposes is exchanged solely for property of a like-kind.”
Therefore, as an investor using the IRC Section 1031, you can exchange raw land for a rental home or rental homes for a commercial building without penalty The key is the use of the property itself. For example, you sell your raw land and buy an apartment building in exchange, which we can manage for you. You have deferred your taxes on the purchase itself while earning a monthly income on the rental units. Basically this means that it is possible to sell property and buy other like-kind property without having to pay the Capital Gains Tax. This way you can continue to invest without losing all your equity to taxes.
At Land Made Easy we can help you protect your investment income by finding you qualified properties . We can also get you in touch with a qualified intermediary if needed. We have a great deal of experience in this area and will walk you through what needs to be done to save your hard earned dollars!