Selling 1 property and 1031 into 3 lower price properties

Omaha, NE · Member since 2020 · 2 posts · 1 vote

Say you sell a property worth a half a million. Is it possible to 1031 exchange it into 3 separate properties that equal the half million?

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Dave FosterBusiness Member

Qualified Intermediary for 1031 Exchanges · St. Petersburg, FL · Member since 2013 · 9k+ posts · 9k+ votes

@Austin Snowdon, Yes indeed. As long as you purchase at least as much as your net sale and use all of the proceeds from the sale in the next purchase or purchases you will defer all tax and depreciation recapture. It doesn't matter if it is one or multiple replacements.

But @Bill B. is right on. There are some rules with the number of properties you identify as potential replacements (not the number you actually purchase). And they can get a little sticky. But they're manageable you just want your QI to walk with you through the swamp.

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Bill B.
Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
6y
Yup. But you want to identify them in advance because of the rules that kick in when you identify more than 3 properties.
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Dave FosterBusiness Member
Qualified Intermediary for 1031 Exchanges · St. Petersburg, FL · Member since 2013 · 9k+ posts · 9k+ votes
6y
@Austin Snowdon, Yes indeed. As long as you purchase at least as much as your net sale and use all of the proceeds from the sale in the next purchase or purchases you will defer all tax and depreciation recapture. It doesn't matter if it is one or multiple replacements.

But @Bill B. is right on. There are some rules with the number of properties you identify as potential replacements (not the number you actually purchase). And they can get a little sticky. But they're manageable you just want your QI to walk with you through the swamp.
The 1031 Investor5137 Reviews
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Tuan Tran
San Jose, CA · Member since 2016 · 37 posts · 7 votes
6y
@Austin Snowdon

What a coincidence. This is what I just did with one of my properties and exchanged it for three lower values properties.

The other coincidence was that @Dave Foster and his exchange company helped us in that effort.
We still have to finish the taxes for it but it was a great experience with Dave and his company.

Good luck.
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