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| Most Asked 1031 Exchange Questions | Quick Answers | Detailed information & helpful 1031 links |
Sometimes we're called 1031 Facilitators or 1031 Accommodators and if you're looking for
help or information to do a §1031 Exchange you've come to the right place.
So whatever name you use for your 1031 Exchange, "Tax Deferred Exchange", "Real Estate Exchange",
"Like Kind Exchange", "Starker Exchange", etc.
And by whatever name you call us Qualified Intermediary, Facilitator, Accommodator, we're here to help.
On this website you'll find the answers to all of your exchange questions. Such as:
What is a 1031 Exchange?In a nutshell it’s a way for owners of business and investment Real Estate to sell their property and buy other like kind property without paying the Capital Gains Tax. These transactions are known as deferred exchanges, or 1031 exchanges, and allow the investor to continue his investment in another property without loosing investment equity to taxes. Trading or exchanging property has gone on for many years but there were no clear IRS rules on how those transactions would be taxed. That all changed in the summer of 1990 when the I.R.S. finally came out with the long awaited rules on Deferred Exchanges. Section 1.1031 of the Internal Revenue Code laid out in detail the procedure for turning a sale and purchase type transaction into an exchange. How do I begin a 1031 Exchange?After you have signed your purchase & sale contract, and made arrangements with title/escrow company or attorney to close your transaction, it's time to set up your 1031 exchange. The easiest, quickest, and least costly way is to go to the "Set Up Your Exchange" button on our website and fill in the requested information. You may want to preview the requested information before you get started, but it's mostly information you already have. We don't ask for any sensitive information (we don't ask for, or need, credit card or social security information), and we don't share information with anyone outside the escrow. What does a 1031 Exchange cost? $450.00 for a complete 1031 exchange with one property sold and one property bought.
How do I find Replacement Properties in my state? The Exchanger's Clearinghouse is lists of commercial or investment Real Estate submitted from individuals seeking an exchange via the Internet. Feel free to browse any of these lists. Don't forget to leave your own listing FREE of charge!
How long does a 1031 Exchange take? There are some time restrictions that apply when you do a 1031 Exchange. Identification and exchange time restrictions start once you have sold your Relinquished Property. The rules even permit you to exchange for property to be constructed to your plans. Great stuff here for tax planning.
How do I do a 1031 Exchange from an installment sale? Many exchanges involve both like-kind property and boot in the form of an installment sale note. This creates a condition causing both §1031 and §453 (dealing with installment sales) to apply. Topic Six explains the tax treatment of the installment note taken in an exchange and how Treasury Decision 8535 coordinates the safe harbor rules of deferred exchanges with installment sale rules. | What do I need to know about 1031 Exchanges?Your exchange will be smoother and easier on you if you take a few moments to become familiar with the IRS rules and procedures governing Sec. 1.1031 exchanges. This information is readily available in our "Exchange Procedure Manual™" which you can find on our website by clicking here. This booklet explains the IRS rules in a condensed form. The procedure and timing of the exchange is explained by our "Step by Step Instructions page ", please click here. What Qualifies for a 1031 Exchange?The classification of properties exchanged determines if the property qualifies for Section 1031 treatment. The IRS's 4 classifications of Real Estate:
The last two qualify for Section 1031 tax deferral, the first two do not. Both the property received and the property sold must be of "Like Kind". It is your use of the property that determines its classification. What the other party does with the property does not affect your tax status. [MORE]
How do I Figure Boot and Taxable Gain? Before your exchange transaction is triggered, you need to figure how boot and taxable gain (if any) works. This topic explains how to identify and figure the amount of boot in a deferred exchange. It deals with boot problems related to mortgage relief inside the exchange. It also provides special in-depth coverage of how to treat installment sale notes inside the exchange period. [MORE]
What is a Safe Harbor? How the safe harbors work is critical to planning a successful exchange. In general terms, a safe harbor is an area of protection. The IRS has spelled out certain standards and procedures for taxpayers to meet in real estate exchanges. As long as the exchanger meets these criteria, he will be in a “safe harbor” and not subject to attack by the IRS. The deferred exchange regulations make explicit four safe harbors you may use to avoid constructive receipt of money or boot. If you use safe-harbor specifications, their use will not be considered in testing to see if you have constructive receipt. That’s why they are called safe harbors. Since the safe harbor rules require the exchanger to use the services of a Qualified Intermediary, a wrong choice can doom your exchange. The four safe harbors are covered, plus related party exchanges, and example of direct deeding and how to chose the right Qualified Intermediary for your transaction. 1031 Exchange Safe Harbor [more info]
How do I figure tax basis on replacement properties? Many people are confused when it comes to figuring the tax basis of the Replacement Property acquired in a §1031 exchange. This topic takes you step-by-step and teaches how to figure this basis called substituted basis. Includes figuring basis when boot is paid and received and allocating basis when more than one Replacement Property is received. Basis for Replacement Property [more info] Can I 1031 Exchange my primary residence?Even though §1031 focuses on like-kind exchanges, the exchange transaction interacts with many other code sections and regulations. Many involve the primary residence. This topic explains the tax considerations that must be taken into account when structuring an exchange involving these properties. It explains how to plan property reclassifications to create great strategies and ideas. Special Issues for 1031 exchanges Three doctrines must be considered when structuring an exchange of real estate. One is the Doctrine of Substance over Form, another is the Doctrine of Step Transactions, and the third is the Doctrine of Constructive Receipt. While these doctrines apply to all sections of the Internal Revenue Code, their application to §1031 exchanges can turn many a “non-taxable exchange” into a “taxable sale.” This topic covers those and other pesky problems that always seem to pop up in an otherwise smooth transaction. Such as transfers between spouses, vacation homes, sale-leasebacks and real estate exchanges involving personal property. 1031 Exchange Special Issues [more]
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| EXPERIENCED - | We have been in business for over 19 years, and we're here to help you do a "1031 Exchange" in all 50 states and the U.S. Virgin Islands. |
| FAST - | We will process your "1031 Exchange" documents the same day we receive the setup information, and in some cases we can complete the relinquished property sale the same day we're notified. Our computerized processing system allows us to be the fastest link in the "1031 Exchange" transaction. |
| SMOOTH - | You can set up your "1031 Exchange" on our website 24 hours a day, 7 days a week. The website is easy to use and doesn't ask for any sensitive information. Just fill it in and we'll take it from there. |
| SEAMLESS - | We deal directly with the closing agent so you only have one closer, one set of closing documents, and one closing for each sale. We keep you advised of the progress of the exchange by E-mail. And you can check the status of your "1031 Exchange" at any time with the "Exchange Tracker" feature on our website. |
| Your Name: | Ask Realty Exchangers! Did you know Realty Exchangers has a vast library of FREE resources available at your fingertips? Answers to the most common 1031 Exchange questions can be found here: |
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The Real Estate Exchange Company
PO Box 1340
Vancouver, WA 98666
Phone 1-360-695-8258
Fax 1-360-695-0106
info@realtyexchangers.com
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