Tax Deferred I.R.C. Section 1031 Exchange
1031/Delayed/Tax-Deferred/Tax Free/Starker - A rose by any other name....
Internal Revenue Code (I.R.C) Section 1031 allows an owner of property held for productive use in a trade or business, or for investment, to defer payment of taxes on gain realized in the sale if they exchange for like-kind property. The tax is deferred (but not avoided) by transferring the basis in the relinquished property to the replacement property. Contact Ricka Gerstmann at Investment Property Exchange Services, Inc. (888) 310-1031 for detailed information or give us a call with your general questions.
- Exchanger: The party completing the exchange. The seller. The code uses the term "taxpayer."
- Accommodator: The entity that facilitates the exchange for the Exchanger. Some companies use the term "facilitator."
- Relinquished Property: The property "sold" by the Exchanger. Also called the "exchange" property or the "downleg."
- Replacement Property: The property acquired by the Exchanger. Also called the "acquisition" property or the "upleg."
How about a real trade as in permanently trading your property for someone else's property. You both just trade homes and deeds and settle the difference in value! There are a number (and growing) of house swap organizations on the internet. I can't vouch for them but the concept is intriquing enough to mention it here. The source was the Mortgage News Daily.
Interested in Trades, Exchanges or Swaps? Call Salmon Capital for friendly and honest support of this alternative type of real estate transaction. It can be tricky to navigate without a professional on your side. BR