What Types Of 1031 Exchange Options Are Available To Me?

There are several 1031 exchange options that you may wish to consider. David and the team at Equity Advantage can help guide you to the option that’s best for your personal investment goals.

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Today we’re talking with David Moore, co-founder of Equity Advantage, a firm that specializes in tax deferred investments, in particular IRS Section 1031 exchanges.

What types of 1031 exchange options are available to me?

David Moore: Historically people have always thought of what we would call a delayed exchange as a 1031 exchange. So we often perform delayed exchanges, where you sell a property first, buy a property later. You’ve got 180 days to do that.

We do reverse exchanges, where we can actually buy a property today to replace a property yet to be sold. Once again we have 180 days. It’s just the opposite direction. We’ve got 45 days from acquisition to ID what’s to be sold and 180 to get it done.

We also do what’s called an improvement exchange. Improvement exchanges allow us to go out and acquire property and literally build the perfect replacement property for our taxpayer.

A final example would be something called a blended transaction, where we might have a partial reverse exchange. We’ll acquire a property today, sell in the future, then the residual proceeds, what’s left over, we’ll use in a delayed format going forward, so we can use that to aggregate a variety of properties in a single acquisition.

David, which type of 1031 exchange is in your experience the most popular?

David Moore: Delayed exchanges. Banking is a lot easier to deal with. The taxpayer takes direct ownership of the property, so we’re not in that chain of title as we are in the reverse exchange or improvement exchange, and it’s what people know. A lot of people just are not aware that those other formats are available to them and can extend their timelines dramatically.

Thank you David. Listeners may call 503-635-1031, or can visit 1031exchange.com for more information.

You can rest assured that David and his team are ready to discuss the variety of 1031 exchange options available to you, then they’ll work with you to craft a strategy that meets your specific investment goals. Give them a call today!