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Tax, SDIRAs & Cost Segregation

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Kyle Shankin
  • Rental Property Investor
  • Oakland County
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151
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"Learned" something odd about 1031 exchanges

Kyle Shankin
  • Rental Property Investor
  • Oakland County
Posted Apr 15 2019, 11:36

I'm hoping someone who's done a 1031 exchange before, or a CPA, can swoop in and drop some knowledge on me. I was over at my CPA's getting my taxes done and talking strategy for this year when the idea of a 1031 exchange came up. My CPA surprised me by saying that 1031 exchange is extremely difficult to pull off, not because of things like qualified intermediaries or the super strict rules about declaring the properties that you're looking at purchasing, or the timeline in which you must purchase said property, but because you have to trade properties in the exchange. Is this correct?

I tried looking this up, but for the couple of hours that I've spent actually looking online, and combing through the books that I've read that mention 1031 exchange, I can't find anything that actually disproves what my CPA has told me. All of the other rules of the exchange are laid out, but the fact that you're meant to swap properties with another individual is never explicitly mentioned.

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