Flawless Section 1031 Exchanges For Over 30 Years

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What are the advantages of an Exchange?

The bottom line is simple. When you use Section 1031 as you are selling and buying personal property, you are able to leverage what you would have paid in capital gains taxes to increase your purchasing power when you replace your property with like-kind property.

With personal property, the like-kind test is literal. Musical instruments are like kind with musical instruments, paintings are like kind with paintings, and sculpture is like kind with sculpture.

 

What is Like-kind?

With personal property, the like-kind test is literal. Musical instruments are like kind with musical instruments, paintings are like kind with paintings, and sculpture is like kind with sculpture.Like Kind.jpg

Some Basic 1031 Rules

  • Once you sell your property (Relinquished Property), you have 45 days to identify (in writing) what you are going to purchase. (Replacement Property)

  • There are specific rules that you must follow surrounding how the identification process is carried out.

  • After you sell your Relinquished Property, you have 180 days to complete the purchase of your Replacement Property.

  • There are NO extensions available.

  • To facilitate a Section 1031 exchange you MUST use a Qualified Intermediary (QI). The QI has many responsibilities, most important of which is to safeguard your proceeds! Pick a good one!


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Investor Vs. Collector

A few of the actions an investing collector might take to establish a qualified investment include:

  • With respect to the asset, behave in a manner conducive and consistent with the expectation of profit as the main motivation to acquire and hold the asset.
     

  • Maintain a complete set of books & records regarding the asset including the purchase, maintenance, modifications, etc.
     

  • Always seek the advice of professionals regarding the disposition of assets being purchased and sold. YOU CAN NOT UTILIZE SECTION 1031 AFTER THE FACT.
     

  • Have the asset regularly appraised and consider keeping an adequate insurance policy.
     

  • Keep a diary of the market activity of similar assets, their selling price, their activity at auctions and notable sales.

Edmund & Wheeler, Inc. QI
567 Cottage Street
Littleton, NH 03561
603.444.0020
603.444.6611 Fax
exchange@section1031.com

Edmund and Wheeler is actively involved
in the exchange community.
Edmund & Wheeler, Inc. headquartered in Littleton, New Hampshire (NH)  is a Section 1031 Qualified Intermediary with over 27 years of experience. Edmund & Wheeler has completed  thousands of successful exchanges in 47 states. George E. Foss III is the firm's principal bringing with him decades of experience in finance, tax issues, banking, real estate and most importantly is a proven expert in all things Section 1031. This site contains real-life examples of successful exchanges, industry insight, detailed case studies of exchanges, Section 1031 news and other related materials.

Copyright 2007-2012. Edmund & Wheeler, Inc. all rights reserved.
The information contained on this site is for informational purposes only and does not constitute tax, legal or accounting advice.