Lower Your Real Estate Transaction Taxes

Section 1031 of the Internal Revenue Code states that the trade of particular types of property may defer or adjourn the recognition of capital losses or gains that are payable upon sale, and for this reason it also defers any taxes on top of any capital gains that are also due. In layman’s term, people who would want to sell a certain property could be exempted from paying taxes over their sales or gains.

However, there are some strict policies and procedures that should be done before a 1031 tax deferred exchange are validated or accomplished. Exchanges should only be between or among like-kind properties and all transactions, transfers, reinvestments etc. are done within the stated time frame. Most importantly before arriving at a decision contact an expert on the IRC so you won’t be regretful in the end.

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Tagged as: 1031 exchange, 1031 exchanges, defer capital gains, irc, like kind exchange