Here Is the Latest Update from the FEA:
On Sept. 15, the House Ways and Means Committee completed the markup of their portion of the $3.5 trillion Budget Reconciliation Bill. We are happy to report that Section 1031 was not amended and remains intact. While this is very good news, the fight is far from over. This is the beginning, not the end of the Budget Reconciliation process.
The Budget Reconciliation Bill could still be modified by the House Budget and House Rules Committees before being voted on by the House; and the legislation may differ from the version being prepared in the Senate committees, which have not yet acted on the legislation. Final passage of the legislation won’t be until the October to December time frame.
In the meantime, FEA will continue its advocacy efforts to preserve Section 1031. One way we do this is through our leadership in the 1031 coalition. The multiple associations that make up the coalition allow our collective voice to be more powerful as we work to educate those in Congress about the economic impact of like-kind Exchanges.
Attached is a recent letter the coalition sent to Congress in advance of the budget reconciliation markup – 40 associations signed the letter.
This week the coalition launched a Section 1031 digital ad campaign. The digital ads are running in Politico Morning Money this week and will run in Politico Morning Tax next week. See below for sample messages from the ad campaign.
The coalition also created a 1031impact.org website. This website is separate from our 1031BuildsAmerica.org site (owned by FEA). With our permission, the coalition borrowed heavily from our whitepapers on 1031BuildsAmerica.org and FEA is listed as a coalition member on the site.
Sample Messages from 1031 Digital Ad Campaign
A message from The 1031 Impact Coalition:
For 100 years, 1031 like-kind Exchanges have helped ordinary Americans grow and expand their businesses. 1031 allows business owners to invest in workers, buildings, and their companies, which provides jobs, boosts local tax revenue, and facilitates economic development. And 1031 provides a pathway to improve all of the above, including underserved communities, when business owners can invest and expand at a lower cost. Altogether, like-kind Exchanges support 568,000 jobs and add $55 billion to GDP.
A message from The 1031 Impact Coalition:
The 1031 impact goes well beyond enabling entrepreneurs to build their businesses. Like-kind Exchanges are an overwhelming positive for the economy, including jobs, investment, and economic growth. They also promote land conservation, create public spaces, and preserve family farms. An estimated 15% of commercial real estate transactions from 2010 through mid-2020 involved a 1031 Exchange.
Importantly, 1031 helps house our communities. Multifamily housing transactions represent 40% of like-kind Exchanges, more than any other building type. Limiting 1031 Exchanges would increase the cost of rental housing and significantly raise rents at a time when America is facing a housing affordability crisis.
Businesses and workers who welcome us into their buildings have been hard hit by the pandemic, but they are resilient in reopening. As America works to emerge, like-kind Exchanges will help a new generation of entrepreneurs create jobs and opportunities, and generate new tax revenue, for our communities.
Thanks for all you are doing to help to save 1031!
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