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Martha
and Don Woods PA
the
internet savvy REALTORS®
Watson
Realty Corp.
1504
S Atlantic Ave
New Smyrna Beach,
Florida 32169
Like-Kind Property Definition
Like-Kind Requirement:
Replacement Property acquired in an exchange must be "like-kind" to the property being sold
(Relinquished Property). Like-kind means "similar in nature or character, notwithstanding
differences in grade or quality." In order for the properties to qualify as "like-kind" they
must be held for productive use in a trade or business or held for investment purposes and be
located within the United States. Foreign property does not qualify. For example: Raw land
held for investment may be exchanged for Single Family Rentals or any combination of the below
examples:
Single Family Rentals
Farms/Ranches
Offices
Motels/Hotels
Golf Courses |
Multi Family Rentals
Raw Land
Retail
Industrial
Leases of 30 years or more |
PROPERTY
NOT ELIGIBLE UNDER 1031:
 | Primary Residence
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| Interest in Partnerships
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| Foreign Property
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| Money
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| Stocks, Bonds, or Notes
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| Stock in trade, inventory or other property held inherently for
sale |
Section 1031 of the Internal Revenue
Code
Sec. 1031 [1986 Code]
1031 - Exchange of property held
for productive use or investment
(a) Nonrecognition of Gain or Loss From
Exchanges Solely in Kind.-
(1) IN GENERAL.- No gain or loss shall be recognized on the exchange
of property held for productive use in a trade or business or for
investment if such property is exchanged solely for property of like
kind which is to be held either for productive use in a trade or
business or for investment.
(2) EXCEPTION.--This subsection shall not apply to any exchange of
--
(A) stock in trade or other property held primarily for sale,
(B) stocks, bonds, or notes,
(C) other securities or evidences of indebtedness or interest,
(D) interest in a partnership
(E) certificates of trust or beneficial interests, or
(F) choses in action.
(e) EXCHANGES OF LIVESTOCK OF
DIFFERENT SEXES. -- for purposes of this section, livestock of
different sexes are not property of a like kind. |
If you need anymore information or have any specific questions about 1031 tax-deferred
exchanges, please contact us at 1031exchange@marthadon.com
or call us at (386)-478-9202 or toll-free 1-877-281-7432.
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