Can I do a 1031 exchange with my share?

[Krystal Nydegger]

I’m a partner in a partnership that owns land. There are several other partners. The partnership is selling a piece of land. Can I do a 1031 exchange with my my share of the proceeds? Other partners will just take the cash.

[Jay Hinrichs]

Quote from @Dave Foster:

@Krystal Nydegger, Not without some some moves before you sell.  If that partnership sells now the partnership has to do the 1031.  And the partners are all stuck together.  There is a process that you might use where the partnership is dissolved immediately before sale and the property is distributed to the former partners as tenants in common.  This has not been the conventional way in the past.   But over the last 10-15 years there have been some favorable rulings that indicate the IRS doesn't have a lot of heartburn with this.  It's called a drop and swap.  Talk to your cpa and see if they're a fan.

We did this with a property in the Sonoma Valley 3 partners  held it 20 some years just deeded it to each of us as tenants in common then we each did our own 1031.. very easy deal really