Opportunity Fund for 1031 Exchange
I have a property in Ft Lauderdale FL that is a STR. The price of the house has tripled. I am considering selling but do not want to pay the tax. I therefore considered doing a 1031 exchange yet the challenge is to find a "like" investment that is not also overly inflated in its price. I was given the advice to look into an Opportunity Zone Fund. I was advised that I could take the money from my STR and roll it tax free into an opportunity zone fund. Does anyone have any knowledge/experience with this strategy?
Most Popular Reply
Hello @Judson Krosney
Unfortunately, you can not 1031 into an Opportunity Zone Fund itself. You can only 1031 into an actual property that is located in the opportunity zone. You would not want to invest in a physical property in the zone without doing the 1031 as that would not provide any tax deferral benefit. If you want to invest in the Fund, you would sell and then invest the gain in the fund directly for the tax deferral benefit. Here are a couple links to learn more:https://abovebelow1031-my.shar... and https://nashionalfinancial-my....
Other like-kind investment options that may not be inflated right now depending on location, etc., would be land, DSTs, oil & gas mineral rights, etc.