Invest Your Tax Refund in Your Home

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  Invest a Tax Refund in Your Home: $500 Projects

  Here are five great ideas for investing a tax refund in your home if you receive $500 or less back from the IRS this year. Read

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Copyright 2011 NATIONAL ASSOCIATION OF REALTORS®

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Are You Thinking About a 1031 Exchange?

Could this be a location for a 1031 property?

United States Internal Revenue Code (26 U.S.C. § 1031)

Section 1031 of the Internal Revenue Code is most often used in connection with the sale of real property.  If you have been in the real estate market looking for a way to invest money and defer taxes, you may have heard about ‘Like-kind exchanges’ or ‘Tax Deferred Exchanges’ as a possible means to accomplish your goals. These are alternate names for what is commonly known as a 1031 Exchange.

This is a simple transaction that allows you to exchange properties of like-kind and defer the taxes. The transaction is simple, but understanding the process may not be! What property qualifies? Here are a couple of examples of what does not qualify:

• 1031(e) livestock of different sexes do not qualify for like kind exchange.


• 1031(h)(1) real property outside the United States and real property located in the United States are not of like kind.

I was surprised about 1031(e). Aren’t you?

What is the difference between a second home and a vacation home? What taxes are being deferred? How long are taxes deferred? How does this benefit me? As a buyer, should I consider entering into an identified 1031 Exchange?  Do qualified exchanges have to be simultaneous? If not, how long do I have to complete a qualified exchange?  

There are many more questions depending on individual circumstances and it is in your best interest to get correct answers to the questions for your individual circumstances rather than depending on an overview to make your decision. Your professional Realtor® will be able to give information, but a Realtor® is only part of the resources you need. Your Realtor® will identify properties for your consideration. Another team member should be a tax attorney and a CPA who are experienced with 1031 Exchanges. They can give answers to how a 1031 Exchange fits into your portfolio, and how a 1031 Exchange fits into your estate.

If you are interested in a 1031 Exchange in on the Charleston Coast, contact me at Mark@MarkandPatriciaFuchs.com, or my business partner, Patricia Fuchs at Patricia@MarkandPatriciaFuchs.com. 

As part of Dunes Properties of Charleston, Nobody Knows the Charleston Coast Better.

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