With the recovery of real estate values, many owners are looking to capture profits by selling their investment properties – only to see those profits eroded by federal, state and local taxes. Performing a “like-kind” exchange under Section 1031 of the Internal Revenue Code enables sellers to reinvest their sales proceeds in new investment properties with better value and higher income potential while deferring taxes.
These transactions can be extraordinarily valuable, but their execution is tricky. Since the IRS will disallow incorrectly executed 1031 exchanges, each transaction should be facilitated by professionals with experience and detailed working knowledge. Midwest Property Source can assist owners with the sale of investment properties under a 1031 exchange, including the proper selection of replacement properties and the reinvestment of proceeds pursuant to a successful exchange.