Maximize Your Real Estate Returns

Discover the Power of 1031 Exchanges

Benefits of a 1031 Exchange

A 1031 exchange is subject to specific rules and timelines, so it's essential to work closely with qualified tax advisors and intermediaries to ensure compliance and maximize benefits.

Tax Deferral

Capital gains taxes on the sale of investment property may be deferred, allowing you to reinvest the full amount into a new property.

Increased Investment

You may leverage the entire amount of proceeds from the sale towards acquiring a more valuable property or portfolio, potentially increasing your overall investment value.

Flexibility

There's flexibility in the types of properties that qualify (as long as they are like-kind), allowing for strategic real estate portfolio management.

Defer Your Tax Burden

When you sell an investment property, you may face a large capital gain and the prospect of paying federal taxes.

A 1031 exchange allows you to dispose of investment properties and acquire “like-kind” properties while deferring federal capital gains taxes. Bottom line: a 1031 exchange lets you reinvest sale proceeds that would otherwise be paid to the government as capital gains taxes.

  • Like-kind property is broadly defined as real estate held for investment or business purposes. This can include different types of real estate, such as exchanging a rental property for a commercial building.

  • Yes, a Qualified Intermediary (QI) is required to facilitate the exchange. The QI holds the proceeds from the sale of the relinquished property and they are used to purchase the replacement property.

    • 45-Day Identification Period: You must identify up tp three potential replacement properties within 45 days of selling your relinquished property.

    • 180-Day Exchange Period: You must complete the purchase of the replacement property within 180 days of the sale of the relinquished property.

  • No, primary residences do not qualify for 1031 exchanges. The property must be held for investment or business purposes.

  • If the replacement property costs less than the relinquished property, the difference (boot) may be subject to capital gains taxes.

Frequently Asked Questions

Get in touch.

Whether you're seeking more information as a first-timer, a seasoned pro, or need assistance with your relinquished property transaction, we're here to help.

Vinopal Exchange is partnered with Vinopal Title & Abstract, a full-service title agency serving Northwestern Wisconsin.