A 1031 exchange, also known as a Starker Trust, is used by a real estate investor who wants to sell an investment property he or she owns but does not want to pay any taxes. A 1031 exchange allows the seller of investment property to defer taxes by purchasing another property that costs at least as much as the property he or she is selling. There are very strict rules for using 1031 exchanges, and if you blog the deadlines or rules, the 1031 will not be valid. Typically, you’ll need a third-party company to hold your 1031 funds (you’ll want to choose this company carefully) and a real estate attorney that you hire to protect your interests. This topic page is the nerve center for hundreds of articles and videos about 1031 exchanges. These articles discuss the nuances of selling property tax-free using a 1031 exchange. You can use the topic cloud on the right navigation to further refine your search.
A 1031 exchange allows you to buy and sell investment property within a specified time period and defer paying taxes to the IRS. Primary residences, second homes and vacation homes are generally not eligible for 1031 exchanges. Real estate market conditions may make it harder to sell a property and potentially prevent a successful 1031 exchange. Talk to a 1031 exchange company about doing a reverse exchange instead.
A 1031 exchange allows you to buy and sell investment property including real estate and defer paying taxes to the IRS. Real estate market conditions may make it harder to sell the old property and potentially prevent a successful 1031 exchange. Learn how real estate market conditions can affect a 1031 tax exchange or Starker exchange and why a reverse exchange may be effective in this housing market.
When you own an asset for business or investment use you can claim some depreciation as that asset drops in value. When you later sell that asset the IRS wants to get back, or recapture, some of the depreciation. Our 1031 exchange expert explains how recapture depreciation tax works.
Depending on when you do your 1031 tax exchange you may be able to claim a failed or partially failed 1031 exchange on your taxes. Learn how the timing of a 1031 exchange affects tax straddling. Be sure to discuss the timing of your 1031 tax exchange with your CPA or tax attorney.
When you want to do a 1031 tax exchange you have to find a qualified intermediary, an impartial third party who will hold your funds. But how can you find a trustworthy 1031 exchange company? Ask them how long they've been in business, what insurance they have, what experience the staff has, where your 1031 funds will be held and what to do if the 1031 company goes bankrupt. Don't just rely on recommendations to find a 1031 exchange company.
When you're doing a 1031 tax exchange you have 45 days to identify your replacement property. The replacement property in a 1031 exchange has to be like kind property. So you have 45 days to find another domestic real estate property if the property you plan to sell is in the U.S. also. Learn whether weekends and holidays are included in the 45 day rule for 1031 exchanges.
If you're doing a 1031 tax exchange on an investment property and you've found your replacement property but not yet sold your first property you'll want to do a reverse exchange. A 1031 reverse exchange allows the 1031 company to take title to the property until you sell it.
When you want to do a 1031 tax exchange for your second home you need to make sure that you're not using the home more than 14 or 20 days of the year. Learn more about 1031 tax exchange rules for second homes and check out our other 1031 videos at expertrealestatetipsl.net.
A 1031 tax exchange is named for part of the IRS tax code. A 1031 exchange allows you to defer paying taxes on investment property including real estate, artwork, helicopters, copyrights, patents and more. You cannot do a 1031 exchange on personal property. This video gives you basic information about a 1031 exchange. For more information, check out our other 1031 exchange videos.