Why is the 1031 tax deferred exchange important to a real estate property investor?

An investor in real estate understands how important it is to preserve wealth and assets. In the frequently changing world of taxation, the investor is fortunate to have IRC Section §1031. This tax code allows the investor to exchange from one investment property to another and defer taxes on the gain. This means that a 1031 exchange is a rollover of equity of like properties, rather than an avoidance of tax. Thus, the investor continues to build wealth through real estate investment, and maintains the hard-earned equity. Any tax liability through inheritance will be limited to the gains from the date of the inheritor’s acquisition, not during the years of ownership. So in essence the taxes that are saved now are never paid.

**ALWAYS CONSULT WITH YOUR CPA, Attorney, or tax Advisor. (Other losses/expenses may affect the gain)**

Disclosures
Dahlman Group, Inc. does not offer investment, legal or tax advice. Any purchase or investment in real estate comes with risks and potential tax, legal and insurance and casualty loss liabilities. Examples of potential gains, cash flows or tax benefits are for illustrative purposes only. Dahlman Group, Inc. is a real estate company, not a registered security or investment advising firm. Dahlman Group, Inc. strongly recommends that you contact your own professional for legal, tax, insurance or investment advice.