1031 Exchange from SFH go passive MF syndications

Rental Property Investor · Nashville, TN · Member since 2016 · 179 posts · 42 votes

Hello,

I was wondering if one can sell a SFH and move that money to a Multifamily Syndication as a passive Investor under 1031 exchange?

Chai

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Investor · Cary, NC · Member since 2017 · 78 posts · 89 votes

@Chai Jonn my understand is that yes you can

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Vinay Kolluru
Investor · Cary, NC · Member since 2017 · 78 posts · 89 votes
5y
@Chai Jonn my understand is that yes you can
1 Reply
Dave FosterBusiness Member
Qualified Intermediary for 1031 Exchanges · St. Petersburg, FL · Member since 2013 · 9k+ posts · 9k+ votes
5y
@Chai Jonn, Generally LP syndications are not compliant with 1031 exchanges. To qualify for 1031 treatment you are selling investment real estate and must purchase investment real estate. In the normal syndication you are not purchasing actual real estate. You are purchasing a membership interest in an entity that owns real estate. That does not qualify.
There are a couple of other syndication-like products that will qualify if what you're trying to do is go from active to passive management but retain the tax deferral and other real estate ownership benefits. Specifically Delaware Statutory Trusts and Tenant's in Common projects.
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Ryan Beatty
Los Angeles · Member since 2020 · 63 posts · 22 votes
5y
We've accommodated 8 1031 exchanges into our current deal via TIC. It's a bit of a lift administratively but yes it's possible.
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