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About 1031 Tax Exchanges

As outlined in the following link, the 1031 deferred tax exchange process, while a very effective financial tool, can be very complicated and often misunderstood  by those not familiar with the process.  We have helped several clients through this process and in a nutshell allowing them to defer capital gains taxes on existing rental properties sold and exchanged for like-kind rental properties.  If the requirements and timelines are not followed specifically as defined by the IRS – the transaction will not be considered a deferred exchange resulting in a capital gains tax liability for the seller.