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What is a 1031 Tax Exchange?

November 4, 2013

 

Welcome back. Every few weeks we like to send you an update on the market and some tips to help you with any of your real estate questions.

With the New Year right around the corner you may be wondering about taxes. If you sell your primary residence, are you eligible for the 1031 tax exchange? As many of you know there is an exemption of $250,000 per individual. I have five tips for those who are considering a 1031 tax exemption.

  1. It must be the same taxpayer, the same owner of the property.
  2. Property identification and time frame; they would like you to know what property you want to purchase within 45 days.
  3. Must close within 180 days (including weekends and holidays).
  4. Value of your new property must be equal to or greater than the current property.
  5. Hold time

These are five things to keep in mind when considering a 1031 tax exchange. Please check with an accountant if you have any questions. Thanks for watching!

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