THE 1031 EXCHANGE RIPPLE EFFECT:

BENEFITS BEYOND TAX DEFERRAL

While investors are no strangers to uncertainty when participating in the real estate market, one thing is very certain – Section 1031 of the Internal Revenue Code provides a substantial and quantifiable benefit to the economy, while also providing several benefits at the taxpayer level. When real estate investors engage in 1031 exchange transactions, they are making an economic contribution. These investors are also personally seeing the benefits of utilizing the 1031 exchange – not only are they able to defer their capital gains tax liability, but also expand opportunities to relocate to more suitable geographic regions, exchange their inefficient properties for more efficient ones, and make the highest and best use of their property. 

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TAX RELIEF FOR DISASTER VICTIMS IN MICHIGAN, WEST VIRGINIA, RHODE ISLAND, TENNESSEE, MAINE, CONNECTICUT, CALIFORNIA, AND WASHINGTON

The IRS has issued several notices over the past few months regarding relief available to victims of disasters in Michigan, West Virginia, Rhode Island, Tennessee, Maine, Connecticut, California and Washington. See the IRS Notices at the preceding links. A taxpayer involved in a 1031 exchange may qualify for relief under either Section 6 or Section 17 of Revenue Procedure 2018-58 (the “Rev. Proc.”), as described below, if they are a victim of one of these disasters.

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ANGIE WATSON

Business Development Manager

385.270.3804

awatson@firstam.com