Product Classes

Product Classes are limited to those found in the North American Industry Classification System (NAICS) as set forth by the United States Government. These codes classify enterprises by their business activity. Although the NAICS classes are numerous, the product classes that involve the manufacturing sector are six-digit codes beginning 31, 32 and 33.


Here are some examples of how a 1031 exchange involving personal property would work.

Example 1. Exchangor would like to exchange an aircraft flight instrument for a flight recorder. Neither of these items falls with an asset class, but they both fall within product class 334511. The two items are like-class and eligible for exchange.

Example 2. Exchangor would like to exchange his fishing tackle and equipment for a sonar fish finder. Neither of these two items falls within an asset class. The fishing tackle and equipment fall within Product class 339920. The sonar fish finder falls within Product class 334511. These two items are not like-classand not eligible for exchange.

Example 3. Exchangor would like to exchange his business airplane (used to transport clients and upper level management to meetings) for a new helicopter engine that will later be used in a helicopter that is currently being manufactured for Exchangor’s business. Both the airplane and the helicopter engine fall with an asset class .21. They are like-class and eligible for exchange.

Example 4. Exchangor would like to exchange his 4-door sedan for a heavy duty SUV/truck. These properties are not like class because the sedan falls within asset class .22 and the heavy duty SUV/truck falls within asset class .241. Because the vehicles fall within an asset class, they cannot be categorized in a product class. These two properties are not eligible for exchange.