What is a 1031 exchange?

A 1031 exchange, also known as a like-kind exchange, is a powerful tax-deferment strategy popular with experienced real estate investors. It allows you to defer capital gains taxes on an investment property when it’s sold—as long as the investor purchases another like-kind property with the proceeds of the first property sale.

Can I get a 1031 exchange if I own a business?

If you own business or investment property, then you may be able to benefit from a 1031 exchange. By buying another like-kind property of equal or greater value, you may be able to defer the capital gains tax bill into the future – or avoid capital gains taxes if you die before selling the last property.

How does a 1031 exchange impact your tax strategy?

Whether you're a first-time investor or a seasoned property owner, a 1031 exchange can impact your tax strategy significantly. With this type of transaction, real estate investors who sell property can defer capital gains taxes by reinvesting proceeds from the sold property into a new property. What is a 1031 exchange?