The name “1031 Exchange” implies that it is a type of real estate transaction where one property is “exchanged” for another. In many cases, this is true, but not always. Under certain circumstances an investor/taxpayer is allowed to exchange one property for multiple. In this article, we are going to discuss the “three property rule” as it relates to 1031 Exchanges. We will describe what it is, how it works, and why it may be beneficial for some investors under the right circumstances. By the end, investors will have the information needed to determine if a three property exchange is a good fi ..read more

When thinking about 1031 exchange transactions, investors often focus on the equity they have built in the property during the holding period. However, it is also important for investors to understand the debt rules that must be followed in order to complete a 1031 exchange and realize the tax benefits. In this article, we are going to discuss what a 1031 Exchange is and the debt rules that investors need to know in order to complete a tax-deferred exchange. By the end, readers will have the information needed to determine if a 1031 Exchange is a good fit for their own needs given the debt rul ..read more

1031 exchanges are very popular with investors, but they can be complicated and the consequences of violating one or more of their rules can be financially very costly for taxpayers. To maximize the chance that the transaction receives full tax deferral, it is helpful to work from a checklist. In this article, we are going to describe a 1031 exchange checklist for real estate investors. In doing so, we will explain what a 1031 exchange is and walk through each of the steps necessary to complete one. By the end, readers will have a better idea of what goes into completing a 1031 exchange and wi ..read more

An Investor’s Guide to the 200% Rule in 1031 Exchanges  A 1031 Exchange is a type of real estate transaction used by real estate investors and real estate agents to defer capital gains taxes by swapping one like-kind investment property for another. The transaction gets its name from IRS Internal Revenue Code Section 1031 and can be a very effective strategy for investors to grow their capital, tax deferred, over time. In this article, we are going to discuss what the 200% Rule in a 1031 Exchange is, how it works, and why it is important to understand it for tax deferral benefits. By the ..read more

Part of the requirement for completing a 1031 Exchange is that once real estate investors sell their property, they are  required to find a “replacement property” within 45 days. While this may seem simple enough, it can actually turn out to be very challenging for investors to find just the right property in a relatively short period of time. In this article, we are going to discuss the exchange rules that investors need to be aware of when planning on purchasing a replacement property to complete a 1031 Exchange. We’ll start by describing 1031 Exchanges in general and then discuss the r ..read more

Often, 1031 Exchange transactions are presented as relatively straightforward – and in many cases they are – but some investors may not realize that there are fairly strict timelines under which the exchange needs to occur. This may change the calculus of a deal. In this article, we are going to discuss what a 1031 Exchange is and the timelines under which they need to be executed. By the end, readers will have the information needed to determine if a 1031 Exchange is a good fit for their own needs given the time constraints involved. At First National Realty Partners, we specialize in the acq ..read more

Over the years, there has been an unfortunate amount of abuse in terms of how commercial real estate investors have used 1031 exchanges. Much of this abuse has stemmed from investors completing an exchange transaction with a “related party”, such as a family member. The Internal Revenue Service (IRS) has issued special rules to help investors understand what is and is not allowed when completing a 1031 exchange. These rules are known as Related Party Rules. At First National Realty Partners, we specialize in the acquisition and management of grocery store anchored retail centers and often assi ..read more

A 1031 Exchange is a type of commercial real estate transaction that allows individual investors to defer capital gains taxes on the profitable sale of an investment property as long as the sale proceeds are reinvested into a replacement property that is “like kind” to the one that was sold. Given the tax benefits, this is a very popular transaction amongst real estate investors. But, every investor is unique and has their own needs and wants – which means that a 1031 exchange may not be the right fit in all scenarios. In this article, we are going to describe six tax deferral alternatives to ..read more