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1031 Exchange Explained

It is the IRS approved method that enables you to sell your commercial real estate commercial real estate and reinvest in another commercial real estate or commercial real estate, deferring all federal (and most state) capital gains taxes. This transaction is authorized by internal revenue code and is one of the best options for real estate investors to rollover their investment commercial real estate while preserving as much wealth as possible. By deferring any applicable taxes, the real estate investor has more money available to invest in other commercial real estate. In effect, you receive an interest free loan from the federal government in the amount you would have paid in taxes.

When combined with a 1031 exchange, tenant in common commercial real estate can be even more attractive. 1031 Exchanges allow you to defer capital gains taxes by investing in a like commercial real estate. When using tenant in common commercial real estate with a 1031 exchange, you can defer capital gains while diversifying your investments. You can purchase shares of various tenant in common commercial real estate in different locales with the proceeds of the 1031 sale.

If you are considering the sale of an investment commercial real estate, contact a specialist today to discuss your 1031 exchange options.