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What is a 1031 exchange? 

A 1031 exchange defers the payment of capital gains tax when you sell your investment property while acquiring another investment property of equal or greater value and receiving the tax proceeds to use in the new property within the allotted time-frame. 

What are the benefits of a 1031 Exchange?

 

1.  You can acquire a new asset that has more investing potential by maximizing your return on the property you are selling with incentivized tax benefits.

2.  You might want to restructure your estate planning and consolidate           your investment properties into one or consolidate into several different assets. 

 

3.  Reset the depreciation time-frame.

The capital gains tax is calculated by using the net-adjusted basis of the asset (The property's original purchase price plus capital improvements minus accumulated depreciation) 

  1.  If you sell the property for more than the depreciated value, you me be subject to depreciation recapture  which will include your accumulated depreciation over the years back into taxable income. 
  2.  You may benefit from a 1031 exchange because as time goes by depreciation accumulates and can increase taxable income. 

  3. Depreciation is the normal wear and tear that is written off every year on the investment property.

How can A&E Invest Group help? 

We offer the specialization needed to execute a 1031 exchange with confidence and ease.  We will tackle the exchange with the strict rules and guidelines and make sure everything is executed according to plan.

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