![]() ![]() By selling the property at fair market value, you would recognize long term capital gain of $50,000 (not accounting for accumulated depreciation or capital improvements). The fair market value of the property in 2019 is $150,000. ![]() By utilizing a deferred 1031 Exchange, you are permitted 45 days from the date of closing to identify potential replacement properties and 180 days from the date of closing to complete the transaction for your replacement property.įor example, assume you purchased a rental property in 2016 for $100,000. The net proceeds from the taxpayer's conveyance of property can be used to purchase one or more like-kind properties with an intent of holding such property for investment. Using a Section 1031 exchange for selling and buying investment property converts an otherwise taxable sale into a tax deferred transaction. ![]()
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