Anyone know that if for example I sell a rental house and then I would like to 1031 into a piece of land to use for hunting. Is this allowed since I am not buying another house? Thx
Yes (if you can make it meet this):
Both properties must be held for use in a trade or business or for investment. Property used primarily for personal use, like a primary residence or a second home or vacation home, does not qualify for like-kind exchange treatment.
Both properties must be similar enough to qualify as "like-kind." Like-kind property is property of the same nature, character or class. Quality or grade does not matter. Most real estate will be like-kind to other real estate. For example, real property that is improved with a residential rental house is like-kind to vacant land. One exception for real estate is that property within the United States is not like-kind to property outside of the United States. Also, improvements that are conveyed without land are not of like kind to land.
@Curt Davis "into a piece of land to use for hunting."
By "hunting," are you saying that you will hunt on this land as a personal hobby?
As long as your going from real property to real property you should meet the "Like kind" requirement - all within in the USA.
BUT talk to a 1031 guy before you do ANYTHING!!!
Mistakes on 1031's are costly.
@Curt Davis , Any type of real estate being held for productive use in trade business or investment can be sold and used in a 1031 to purchase any other type of real estate to be held for productive use in trade business or for investment.
The sale of your house and the purchase of land for hunting would be an appropriate 1031 as long as the valuations can work and as long as it's not just your personal hunting. It must be used for investment. So the "hunting leases" mentioned by @Matt K. would be perfect. I once took a $6,000 hike on a hunting lease looking at lots of elk all just a little too far off.
So would using that as a corporate trophy piece where you took clients and vendors to reward and sell them. Make sure your accountant is on board with your proposed use. To simply use it for your own enjoyment I fear would make it property for personal not investment use.
Thanks everyone for the advice!!!
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