1031 exchange
Selling an investment property and buying another? A 1031 exchange can defer capital-gains tax. Here's how it works.
Section 1031 of the tax code lets you defer capital-gains tax when you sell real estate held for investment or business use and reinvest in like-kind real estate. Ikon helps you sell and find the replacement property; our in-house title company, Loudoun Title, closes both sides and works with your Qualified Intermediary.
Not tax advice: your CPA or attorney confirms whether an exchange is right for you.
- 1
Plan before you list
Talk to your CPA and choose a Qualified Intermediary (QI) before you sell.
- 2
Sell
The sale proceeds go straight to your QI, never to you.
- 3
Identify within 45 days
Name your replacement property in writing within 45 days of the sale.
- 4
Close within 180 days
Buy the replacement property within 180 days of the sale (or by your tax-return due date, if that comes first).
Good to know
- Like-kind means real estate held for investment or business, not your own home.
- To defer all the tax, buy property of equal or greater value and reinvest all the proceeds.
- The same taxpayer who sells should buy the replacement property.
Questions? Get in touch or call (703) 282-8444.