Unlike residential properties, there is no exemption or grace period when selling investment property. Once sold, you have created a taxable event. The old business maxim, “It’s not how much you make, but how much you keep” is one of the main motivations behind so-called tax deferred real estate exchanging. Permitted under Section 1031 of the Internal Revenue Code, savvy investors can sell their property and move up to larger investments without currently paying large capital gains taxes.
This not only preserves wealth, but also increases your ability to create greater wealth by allowing you to use funds that would have been used to pay taxes, to acquire a much larger investment.
We have consummated countless exchanges using both the popular Starker Trust as well as doing outright equity swaps.
