Keeping the exchange process simple for you! |
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Americans Are
Transforming Real Estate
It’s A Good Time to Reposition—or Expand—in 2023
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Many factors are driving shifts in the real estate market: inflation and a subsiding US economy, post-pandemic jitters, and trends in the way Americans are using real estate. We are seeing a correction from two years of explosive economic growth, the effects of widespread remote work, solid demand for new housing options, and younger generations purchasing more affordable housing in rural and suburban areas. People are moving to the sunbelt. Commercial real estate properties are vacant or being repurposed to residential space as work habits change. And, the offices that are left occupied are competing with newer, more collaborative spaces. Combine these dramatic changes with higher interest rates and we have a forecast for storm clouds—or opportunities.
The real estate market has cooled but is still a good investment. Projections of mild recession and short recovery, shifting demand, and market conditions in 2023 offer novel opportunities to invest in real estate. We also see encouraging tailwinds for real estate investors who want to wait for better economic conditions. These shifts and the economy are difficult adjustments, but this correction provides “strong opportunities for investors to reposition for growth.”
As many have said, the key to the economy in 2023 is whether the Fed can get inflation under control. As interest rates vary, so goes the real estate, one of the first markets to react to central bank monetary policy. If inflation is wrestled into a manageable state, real estate conditions may improve, and homebuyers may be tempted back to the market. However, investors are still buying...
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The real estate market has cooled but is still a good investment.
We also see encouraging tailwinds for real estate investors waiting for more favorable economic conditions.
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Schedule a 1031 Presentation |
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The 1031 CORP. Exchange Team is available to present seminars, webinars and continuing education courses on 1031 exchanges, their many benefits and the requirements of a successful exchange to your association or groups.
Our team will tailor the presentation to your audience and time schedule.
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New Pennsylvania Law Opens In-State Section 1031 Like-Kind Exchanges! |
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As of January 1, 2023, property owners in Pennsylvania can report Section 1031 like-kind exchanges on state income tax filing. |
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Taxpayers can now exchange like-kind property in the Keystone State, with recognized deferment on Pennsylvania state income taxes. The new law recognizing Section 1031 for state capital gains taxes took effect on January 1, 2023.
This long-awaited change levels the playing field for Pennsylvania taxpayers and non-residents with property in Pennsylvania. Pennsylvania residents will see greater ability to improve business resilience, diversify investments, build wealth, maximize their buying power, and benefit from greater mobility in real estate. The new law paves the way for more commercial development from non-resident investors. Exchange property owners can now make better use of their continuous investment in real estate
The state government can reap new economic benefits from like-kind exchanges, such as greater capital investment in local economies, job growth, communities with repurposed real estate and improved properties, and the tax revenue generated by economic activity from the use of like-kind exchanges...
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1031 Exchanges Made Easy
Thursday, March 2, 2023
12:00 PM Eastern
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1031 CORP. provides an easy-to-follow overview of 1031 tax-deferred exchanges and their many benefits. We'll also review the requirements of a successful exchange and the essential role of 1031 CORP. to keep the exchange transaction simple for all parties and wrap up with questions and answers. |
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Emily Brooks
1031 CORP.
Exchange Officer, Branch Manager
Bend, Oregon
(541) 388-1031 ext. 251
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Emily Brooks
Role: Exchange Officer and Branch Manager, Bend office
Location: Bend, Oregon
Contact Info: (541) 388-1031 ext. 251
Specialties:
- Complex exchanges
- Farm and ranch
- Mixed-use properties
- Fractional interests (DSTs, TIC sales)
- Improvement and reverse exchanges
- 1031 exchange educator
What advice can you give a client starting a 1031 exchange?
First-time exchangers should think of a 1031 exchange as a tax planning decision, not just a deferral strategy. Because the tax is deferred, and not erased, it should be understood that the tax in a 1031 exchange strategy may become due and payable at a later date. You are making future tax planning decisions today. Having the proper advisors on board—CPAs, attorneys, financial advisors—is a critical step to making those future steps go smoothly.
One common misconception that seasoned exchangers carry is about the roles of debt and cash in an exchange. You must buy replacement property that is equal to, or greater than, the net selling price (sale price less closing costs) of the relinquished property to maximize the deferral. Proceeds that are not reinvested, including any debt satisfied by the sale, are taxable. Additionally, as a buyer of a replacement property, you cannot use debt to receive any cash proceeds, or boot, out of the first sale transaction without causing a taxable event.
However, cash can replace debt in a transaction. So, if a relinquished property sells for $500,000 through a 1031 exchange with $200,000 allocated to debt and $300,000 in equity, you can pay off the debt on that sale, and purchase a $500,000 replacement property, owned outright.
What makes 1031 CORP. unique? Why do our services shine above other Qualified Intermediaries?
Experience and Expertise. The 1031 CORP. team’s knowledge of Section 1031 and willingness to educate and guide clients through the exchange process put us heads above peer Qualified Intermediaries.
Industry Involvement. 1031 CORP. is a member company of the only professional association for Qualified Intermediaries, the Federation of Exchange Accommodators (FEA). We keep up with industry best practices and education, the latest rules, and follow the FEA ethics guidelines. Many of our exchange staff are Certified Exchange Specialists® through FEA.
Transparency and Client Protections. We also provide the most transparent exchange experience I’ve ever seen, especially internal controls on the protection of client exchange funds. These are extra steps and not every Qualified Intermediary does them, but we feel it’s best for our clients.
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Welcome Lucas Ecklund-Baker
to the 1031 CORP. Communications Team
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Lucas was previously Communications Manager for the Federation of Exchange Accommodators (FEA). |
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1031 CORP. welcomes Lucas Ecklund-Baker, who will serve in the company’s newly developed position as Communications Specialist. He is responsible for advancing communications and public relations functions at 1031 CORP.
“Lucas is a great fit for our communications team. 1031 CORP.’s perspective and advice have been central to our relationships with clients, so it just makes sense. I had the pleasure of working with Lucas when we worked with our national trade association for Qualified Intermediaries. I experienced his work ethic and writing skills. I am thrilled to be working with him again and know his contributions will benefit the needs of 1031 CORP. clients,” said Margo McDonnell, 1031 CORP.’s president. “Working with Margo and the 1031 CORP. team through FEA was always rewarding and fun. 1031 CORP. is a leader in the industry and shows their value in relationships. Margo leads the way. I’m grateful and excited to be a part of the 1031 CORP. family,” said Ecklund-Baker.
Lucas comes from a governmental agency responsible for regional urban planning, economic development, and transportation...
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Serving as a nationwide Qualified Intermediary for 1031 tax-deferred exchanges since 1991, 1031 CORP. strives to provide an exceptional exchange experience for our clients and their advisors. We provide our clients with enhanced security of funds, knowledgeable exchange professionals and a commitment to keep the exchange process simple for our clients and their advisors. Our Exchange Team, which includes Certified Exchange Specialists®, has the experience and expertise to facilitate even the most complex exchange transactions, including reverse and improvement exchanges.
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