Have you ever sold a commercial or income investment property and wished you could eliminate the need to pay the Capital Gains taxes due on the increase in value of the sold property?
Well, you can postpone Capital Gains taxes if you arrange to buy a 'Like Property" after you have sold the existing property and followed the requirements of the IRS 1031 Exchange process.
The bare bones requirements are:
1) Tell your listing agent and Attorney that the property being sold is to be exchanged through the 1031 process.
2) Indicate in the listing of the property that you want the sale to be part of a 1031 Exchange.
3) Select a Qualified Intermediary (QI) to handle the paperwork and the money.
4) Select three "like kind" replacement properties and list them, within 45 days of closing on your relinquished property, with the Qualified Intermediary (QI).
5) Purchase and close on one of the three properties listed with the QI within 180 days of the closing on your relinquished property.
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