Real Property Exchanges

Real property exchanges involve swapping one piece of real estate for another, often without a cash transaction. This process can be beneficial for property owners looking to change their investment or property type while deferring taxes on any gains. The exchange must meet specific IRS rules to qualify, specifically under Section 1031, which allows for the deferral of capital gains taxes if the properties involved are of “like-kind.” This strategy can help investors optimize their portfolios while maintaining their investment capital for future growth.