There is no minimum period of ownership required for 1031 exchange properties. A 1031 tax-deferred exhange allows owners of land, investment and business real property to sell at a profit and acquire more valuable real property without being taxed on their gain.
For example, investment land may be sold and a more valuable property - like an apartment building or a percentage ownership in an office building - may be acquired without tax liability. A 1031 tax-deferred exchange is similar to an IRA or a 401(k) retirement plan that is not subject to taxation until the investor begins to cash out of the retirement plan.
IRS rules require that real estate investors or business owners engaged in 1031 exchanges use a qualified intermediary. Many firms provide this service. IRS rules require that the real property must be held for business or investment purposes.
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