1031 Tax Exchanges have been the law for a very long time. The U.S. tax law has recognized that the exchange of one investment or business-use property for another of like-kind results in no change in the economic position of the taxpayer, and therefore, should not result in the immediate imposition of income tax. The exchange rules permit the deferral of taxes, so long as the taxpayer satisfies numerous requirements and consummates both a sale and purchase within 180 days.  Real estate investors and commercial real estate practitioners place a very high priority on retaining the current like-kind exchange rules.

There are companies that specialize in the 1031 Exchanges and handle the entire transaction. Making sure your Realtor understands 1031 Exchanges will help you navigate this process and save you tax dollars.