Haven 1031 Exchange Services
2124 Main Street, Suite 165
Huntington Beach, California 92648.
866-794-1031. / 866-342-6162. fax
dorothyzink@havenexchange.com www.havenexchange.com
At its core, a 1031 exchange is designed to accomplish one simple goal: to avoid taxes. But owners turn to 1031 exchanges to carry out a variety of business strategies. A retail owner might use an exchange to trade an old mall for a newer, trendier shopping center. In a more complex deal, an exchange can be part of an exit strategy for a partnership. In a 1031 exchange, owners defer the capital gains tax they typically pay in a property sale. For instance, an investor that purchases a building for $20 million and then sells it for $50 million will avoid paying taxes on the $30 million gain.
All 1031 exchanges revolve around two absolute deadlines. Within 45 days of closing on the relinquished property, a 1031 trader must file a list of possible replacement properties with an intermediary — a firm certified to act as the closing agent for 1031 exchanges. The second deadline occurs 180 days after the initial transaction. At that time, the exchanger must close on a replacement property, using equity equal to or more than the equity in the original property. Miss either deadline, and the IRS will send a capital gains tax bill.
Feed