1031 exchange
1031 Exchange can help your real estate portfolio grow
Understanding 1031 Exchanges: A Smart Move for Commercial Property Owners
As a commercial property owner, you may be sitting on appreciated real estate and wondering how to reposition your holdings without triggering a big tax bill. One of the most powerful tools available to you is a Section 1031 exchange. A 1031 exchange allows you to sell an investment or business property and reinvest the proceeds into another qualifying property without immediately paying capital gains taxes. Instead, taxes are deferred, freeing up more of your equity to reinvest and grow.
Here’s what makes a 1031 exchange attractive:
Tax Deferral: You can defer capital gains taxes on the sale of your property by reinvesting in like-kind real estate. Increased Buying Power: With more of your equity available, you can move into larger or more profitable properties.
Portfolio Flexibility: Shift from one type of property to another (for example, from single-tenant to multi-tenant, or from one region to another) while deferring taxes. Estate Planning Benefits: Properly structured exchanges can help you preserve wealth and pass property to heirs more efficiently.
The rules and timelines are strict—like-kind property requirements, 45-day identification, and 180-day closing periods—but with the right guidance and a qualified intermediary, a 1031 exchange can be an invaluable strategy for building and preserving wealth. If you’re considering selling a commercial property in North Carolina or want to explore how a 1031 exchange might fit into your plan, My team would be happy to discuss your options. Give us a call today!