Like-Kind 1031 Exchanges
A 1031 like-kind exchange provides an opportunity for someone to sell business or investment real property, such as land, rental units, office building, or a farm, and potentially defer paying capital gain taxes by using the proceeds to purchase another qualifying business or piece of investment real property, referred to as the “replacement property”. Effective 2018, Section 1031 exchanges can only be used for real estate, land, and buildings, and not for art, vehicles, or other nonqualifying property. The rules are complicated and there are specific deadlines that must be followed. If you fail to comply with any one of the rules, the entire transaction can fail.