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  • Webinar: Mechanics of 1031 Tax-Deferred Exchange

    This will be a discussion of the general concepts of 1031 tax-deferred exchanges of real estate, including the technical and chronological requirements as well as the process, procedures and different structures. Attorneys in attendance will come away with a basic working knowledge of 1031 transactions, and recognize some of the terminology and instances where a client may want to consider a 1031 exchange transaction or need the services of a professional qualified intermediary (QI), exchange accommodation titleholder (EAT), or registered investment advisor (RIA) in acquiring like-kind replacement property.
    presented by
    Jordan Born, Accruit
    Joseph LoPresti, Arlington Wealth Management
    When: Wednesday, November 11th, 8:15-9:30AM CST
    Where: Online
    MCLE approved for 1-hour credit
    Registration is Free for IRELA Members
    Non-Members ~ $50

    https://js.hscta.net/cta/current.js”> hbspt.cta.load(6205670, ‘e8ef1a38-89c4-4375-8ef6-5b207e19d7e3’, {});

  • Webinar: Mechanics of 1031 Tax-Deferred Exchange

    This will be a discussion of the general concepts of 1031 tax-deferred exchanges of real estate, including the technical and chronological requirements as well as the process, procedures and different structures. Attorneys in attendance will come away with a basic working knowledge of 1031 transactions, and recognize some of the terminology and instances where a client may want to consider a 1031 exchange transaction or need the services of a professional qualified intermediary (QI), exchange accommodation titleholder (EAT), or registered investment advisor (RIA) in acquiring like-kind replacement property.
    presented by
    Jordan Born, Accruit
    Joseph LoPresti, Arlington Wealth Management
    When: Wednesday, November 11th, 8:15-9:30AM CST
    Where: Online
    MCLE approved for 1-hour credit
    Registration is Free for IRELA Members
    Non-Members ~ $50

    https://js.hscta.net/cta/current.js”> hbspt.cta.load(6205670, ‘e8ef1a38-89c4-4375-8ef6-5b207e19d7e3’, {});

  • The Myth of the 1031 Exchange Cooperation Clause

    In this post, we will take a brief look into the evolution of Section 1031 to show why it was critical along the way to make use of an “Exchange Cooperation Clause” and why, as the rules changed over time, such use is no longer necessary.
    The Starker case
    Section 1031 made its way into the Tax Code in 1921, nearly a hundred years ago. At that time, until the mid-1980s, the sale and purchase were thought to need to take place “simultaneously”, after all, isn’t that the commonsense definition of a trade between two people? Apparently not. Beginning in the late 1970s and continuing into the mid-1980s, in the landmark case of Starker vs. U.S., it was determined by a Federal District Court in California that there did not appear to be any requirement in the plain language of Section 1031 of simultaneity.

    “No gain or loss is recognized if property held for productive use in a trade or business or for investment is exchanged solely for property of a like kind to be held either for productive use in a trade or business or for investment”.

    This seemingly innocuous ruling opened up a Pandora’s Box of opportunity, not to mention confusion. The period of time for completing the trade with his buyer in the Starker case was five years. In 1986, shortly after the decision came out, Congress chose a legislative fix. It agreed that Section 1031 did not require the exchange of the properties to take place at the same time but decided to limit the open ended duration to complete the trade of the one for the other to 180 days. Essentially that limited time period still allowed the two transactions to be close enough in time to be considered to be tied to one another. But anything of a longer period simply broke the link between the sale and the purchase into unrelated (for tax purposes) transactions.
    Identification and purchase period to qualify for 1031 exchange
    As for the opportunity presented, taxpayers had

  • The Myth of the 1031 Exchange Cooperation Clause

    In this post, we will take a brief look into the evolution of Section 1031 to show why it was critical along the way to make use of an “Exchange Cooperation Clause” and why, as the rules changed over time, such use is no longer necessary.
    The Starker case
    Section 1031 made its way into the Tax Code in 1921, nearly a hundred years ago. At that time, until the mid-1980s, the sale and purchase were thought to need to take place “simultaneously”, after all, isn’t that the commonsense definition of a trade between two people? Apparently not. Beginning in the late 1970s and continuing into the mid-1980s, in the landmark case of Starker vs. U.S., it was determined by a Federal District Court in California that there did not appear to be any requirement in the plain language of Section 1031 of simultaneity.

    “No gain or loss is recognized if property held for productive use in a trade or business or for investment is exchanged solely for property of a like kind to be held either for productive use in a trade or business or for investment”.

    This seemingly innocuous ruling opened up a Pandora’s Box of opportunity, not to mention confusion. The period of time for completing the trade with his buyer in the Starker case was five years. In 1986, shortly after the decision came out, Congress chose a legislative fix. It agreed that Section 1031 did not require the exchange of the properties to take place at the same time but decided to limit the open ended duration to complete the trade of the one for the other to 180 days. Essentially that limited time period still allowed the two transactions to be close enough in time to be considered to be tied to one another. But anything of a longer period simply broke the link between the sale and the purchase into unrelated (for tax purposes) transactions.
    Identification and purchase period to qualify for 1031 exchange
    As for the opportunity presented, taxpayers had

  • The Myth of the 1031 Exchange Cooperation Clause

    In this post, we will take a brief look into the evolution of Section 1031 to show why it was critical along the way to make use of an “Exchange Cooperation Clause” and why, as the rules changed over time, such use is no longer necessary.
    The Starker case
    Section 1031 made its way into the Tax Code in 1921, nearly a hundred years ago. At that time, until the mid-1980s, the sale and purchase were thought to need to take place “simultaneously”, after all, isn’t that the commonsense definition of a trade between two people? Apparently not. Beginning in the late 1970s and continuing into the mid-1980s, in the landmark case of Starker vs. U.S., it was determined by a Federal District Court in California that there did not appear to be any requirement in the plain language of Section 1031 of simultaneity.

    “No gain or loss is recognized if property held for productive use in a trade or business or for investment is exchanged solely for property of a like kind to be held either for productive use in a trade or business or for investment”.

    This seemingly innocuous ruling opened up a Pandora’s Box of opportunity, not to mention confusion. The period of time for completing the trade with his buyer in the Starker case was five years. In 1986, shortly after the decision came out, Congress chose a legislative fix. It agreed that Section 1031 did not require the exchange of the properties to take place at the same time but decided to limit the open ended duration to complete the trade of the one for the other to 180 days. Essentially that limited time period still allowed the two transactions to be close enough in time to be considered to be tied to one another. But anything of a longer period simply broke the link between the sale and the purchase into unrelated (for tax purposes) transactions.
    Identification and purchase period to qualify for 1031 exchange
    As for the opportunity presented, taxpayers had

  • The Myth of the 1031 Exchange Cooperation Clause

    In this post, we will take a brief look into the evolution of Section 1031 to show why it was critical along the way to make use of an “Exchange Cooperation Clause” and why, as the rules changed over time, such use is no longer necessary.
    The Starker case
    Section 1031 made its way into the Tax Code in 1921, nearly a hundred years ago. At that time, until the mid-1980s, the sale and purchase were thought to need to take place “simultaneously”, after all, isn’t that the commonsense definition of a trade between two people? Apparently not. Beginning in the late 1970s and continuing into the mid-1980s, in the landmark case of Starker vs. U.S., it was determined by a Federal District Court in California that there did not appear to be any requirement in the plain language of Section 1031 of simultaneity.

    “No gain or loss is recognized if property held for productive use in a trade or business or for investment is exchanged solely for property of a like kind to be held either for productive use in a trade or business or for investment”.

    This seemingly innocuous ruling opened up a Pandora’s Box of opportunity, not to mention confusion. The period of time for completing the trade with his buyer in the Starker case was five years. In 1986, shortly after the decision came out, Congress chose a legislative fix. It agreed that Section 1031 did not require the exchange of the properties to take place at the same time but decided to limit the open ended duration to complete the trade of the one for the other to 180 days. Essentially that limited time period still allowed the two transactions to be close enough in time to be considered to be tied to one another. But anything of a longer period simply broke the link between the sale and the purchase into unrelated (for tax purposes) transactions.
    Identification and purchase period to qualify for 1031 exchange
    As for the opportunity presented, taxpayers had

  • The Myth of the 1031 Exchange Cooperation Clause

    In this post, we will take a brief look into the evolution of Section 1031 to show why it was critical along the way to make use of an “Exchange Cooperation Clause” and why, as the rules changed over time, such use is no longer necessary.
    The Starker case
    Section 1031 made its way into the Tax Code in 1921, nearly a hundred years ago. At that time, until the mid-1980s, the sale and purchase were thought to need to take place “simultaneously”, after all, isn’t that the commonsense definition of a trade between two people? Apparently not. Beginning in the late 1970s and continuing into the mid-1980s, in the landmark case of Starker vs. U.S., it was determined by a Federal District Court in California that there did not appear to be any requirement in the plain language of Section 1031 of simultaneity.

    “No gain or loss is recognized if property held for productive use in a trade or business or for investment is exchanged solely for property of a like kind to be held either for productive use in a trade or business or for investment”.

    This seemingly innocuous ruling opened up a Pandora’s Box of opportunity, not to mention confusion. The period of time for completing the trade with his buyer in the Starker case was five years. In 1986, shortly after the decision came out, Congress chose a legislative fix. It agreed that Section 1031 did not require the exchange of the properties to take place at the same time but decided to limit the open ended duration to complete the trade of the one for the other to 180 days. Essentially that limited time period still allowed the two transactions to be close enough in time to be considered to be tied to one another. But anything of a longer period simply broke the link between the sale and the purchase into unrelated (for tax purposes) transactions.
    Identification and purchase period to qualify for 1031 exchange
    As for the opportunity presented, taxpayers had

  • The Myth of the 1031 Exchange Cooperation Clause

    In this post, we will take a brief look into the evolution of Section 1031 to show why it was critical along the way to make use of an “Exchange Cooperation Clause” and why, as the rules changed over time, such use is no longer necessary.
    The Starker case
    Section 1031 made its way into the Tax Code in 1921, nearly a hundred years ago. At that time, until the mid-1980s, the sale and purchase were thought to need to take place “simultaneously”, after all, isn’t that the commonsense definition of a trade between two people? Apparently not. Beginning in the late 1970s and continuing into the mid-1980s, in the landmark case of Starker vs. U.S., it was determined by a Federal District Court in California that there did not appear to be any requirement in the plain language of Section 1031 of simultaneity.

    “No gain or loss is recognized if property held for productive use in a trade or business or for investment is exchanged solely for property of a like kind to be held either for productive use in a trade or business or for investment”.

    This seemingly innocuous ruling opened up a Pandora’s Box of opportunity, not to mention confusion. The period of time for completing the trade with his buyer in the Starker case was five years. In 1986, shortly after the decision came out, Congress chose a legislative fix. It agreed that Section 1031 did not require the exchange of the properties to take place at the same time but decided to limit the open ended duration to complete the trade of the one for the other to 180 days. Essentially that limited time period still allowed the two transactions to be close enough in time to be considered to be tied to one another. But anything of a longer period simply broke the link between the sale and the purchase into unrelated (for tax purposes) transactions.
    Identification and purchase period to qualify for 1031 exchange
    As for the opportunity presented, taxpayers had

  • Preserving Section 1031

    As members of the Federation of Exchange Administrators (FEA), Accruit is an active participant in the work that is being done to preserve Section 1031 of the Internal Revenue Code. The FEA is incredibly important to our industry and we are proud to be members and support the work they are doing.
    The History of 1031 Exchange
    IRC Section 1031 will be 100 years old in 2021, and the intent behind its creation was to encourage active reinvestment within our communities by deferring the payment of tax on gain when the full value is rolled over into other real estate. The benefit to investors in utilizing a 1031 exchange is that the capital gains taxes are deferred, allowing them to use those funds to increase their level of investment. In fact, according to an often-cited study, 88% of properties involved in an exchange are later sold in a taxable transaction (how 1031s build America. Not much has changed in five years since this was written, and the importance of our industry has never been more apparent than it is right now. The impact of the COVID-19 global pandemic has had a grave impact on Mainstreet America as businesses have had to close operations either temporarily or permanently. The infusion of cash into local economies that comes as a result of 1031 exchange transactions influences not just real estate, but the labor and construction markets as well.
    Utilizing 1031 exchange gives taxpayers options to grow and diversify their real estate holdings. It allows them to invest in new housing programs in their communities. 1031 exchange sustains farms and ranches, building businesses that can be passed down for generations. There are a variety of ways that real estate investors use 1031 exchange to grow and diversify their portfolios, and when they do, the communities around them benefit.
    Help Us Preserve 1031 Exchange
    As read the piece the FEA has created, then ask you to contact your state representatives and ask them to preserve 1031 exchanges.
    With three past Presidents of the FEA and five board-level members on our staff, Accruit is committed to ensuring that this industry continues for another 100 years and beyond.

    https://js.hscta.net/cta/current.js”> hbspt.cta.load(6205670, ‘0ff4c47e-7525-4b81-8209-0e8af34134a5’, {});

  • Preserving Section 1031

    As members of the Federation of Exchange Administrators (FEA), Accruit is an active participant in the work that is being done to preserve Section 1031 of the Internal Revenue Code. The FEA is incredibly important to our industry and we are proud to be members and support the work they are doing.
    The History of 1031 Exchange
    IRC Section 1031 will be 100 years old in 2021, and the intent behind its creation was to encourage active reinvestment within our communities by deferring the payment of tax on gain when the full value is rolled over into other real estate. The benefit to investors in utilizing a 1031 exchange is that the capital gains taxes are deferred, allowing them to use those funds to increase their level of investment. In fact, according to an often-cited study, 88% of properties involved in an exchange are later sold in a taxable transaction (how 1031s build America. Not much has changed in five years since this was written, and the importance of our industry has never been more apparent than it is right now. The impact of the COVID-19 global pandemic has had a grave impact on Mainstreet America as businesses have had to close operations either temporarily or permanently. The infusion of cash into local economies that comes as a result of 1031 exchange transactions influences not just real estate, but the labor and construction markets as well.
    Utilizing 1031 exchange gives taxpayers options to grow and diversify their real estate holdings. It allows them to invest in new housing programs in their communities. 1031 exchange sustains farms and ranches, building businesses that can be passed down for generations. There are a variety of ways that real estate investors use 1031 exchange to grow and diversify their portfolios, and when they do, the communities around them benefit.
    Help Us Preserve 1031 Exchange
    As read the piece the FEA has created, then ask you to contact your state representatives and ask them to preserve 1031 exchanges.
    With three past Presidents of the FEA and five board-level members on our staff, Accruit is committed to ensuring that this industry continues for another 100 years and beyond.

    https://js.hscta.net/cta/current.js”> hbspt.cta.load(6205670, ‘0ff4c47e-7525-4b81-8209-0e8af34134a5’, {});