Internal Revenue Code 1031 allows you to do this through a deferment process in which all of your gains are reinvested into a new property instead of taxed.Īll of your profits that you would normally be taxed on are deferred as long as you purchase a similar like-kind property. The purpose of a 1031 exchange is to defer your tax gains when you sell an investment property by purchasing another like-kind property. Defer Taxes with 1031 Exchange Companies What is a 1031 ExchangeĪ 1031 exchange gets its name from the IRS tax code section 1031.Best 1031 Exchange Companies – Qualified Intermediary.1031 Exchange Exclusions & Like-Kind Property Exclusions.
What are the Advantages of a 1031 Exchange.However, if you are a real estate investor, using 1031 exchange companies to buy properties with is a great strategy to gain access to capital to use for future “like-kind exchanges” for real estate investments instead of paying capital gains tax instead.īelow are some of the best 1031 exchange companies that can administer 1031 exchanges. This wealth building tool allows an investor to defer as much as 30% capital gains tax.įor that reason, real estate investors use the best 1031 exchange companies as a qualifying intermediary to handle these highly complex transactions.Īdministering a 1031 exchange is not for a beginner investor to navigate. At some point Uncle Same will get his money!Ī 1031 exchange can be used to defer taxes if all of the requirements are met. If you are a real estate investor, by using one of the best 1031 exchange companies as a qualified intermediary listed below, you can defer the payment of capital gains tax until death if you choose. In fact, using a 1031 exchange company is one of the best ways to avoid paying capital gains tax on a rental property altogether. Knowing the best 1031 exchange companies can save you a lot of money when it comes to selling investment properties. Please check out my disclosure page for more details. This post may contain affiliate links to products that I recommend and I may earn money or products from companies mentioned in this post.
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