1031 Exchanges

Internal Revenue code 1031 allows investors to sell one property and re-invest in another "like kind" property to defer thier capital gains taxes. This gives the investor more capital to work with and essentially creates more "buying power". To fully qualify for a 1031 exchange you must meet the following timelines and criteria:

The Replacment property must be identified within 45 days of the closing of the original property.
You must close on the replacment property within 180 days of the sale of the original property.
A qualified itermediary must complete your 1031 exchange. This means the intermediary will hold the proceeds of the original property until those funds are reinvested.
The property must be of "like kind", which means the investor must roll into a similar type of property, such as a business or investment property.

For more information on 1031 Tax Free Exchanges, please go to Federation of Exchange Accommodators.