What is a 1031 exchange?
If you're selling investment real estate and don't want a big capital-gains bill this year, a 1031 exchange is the path most investors look at first.
Under Internal Revenue Code §1031, you can sell qualifying real property and move the proceeds into like-kind replacement property without recognizing capital gains at the sale, if you meet the IRS timing and documentation rules. You still work with a Qualified Intermediary, a CPA, and counsel. The hard part for most people isn't the concept. It's the clock.
Why the timing matters
After your relinquished property closes, the IRS gives you a short identification period and a short completion period. Miss either one and the exchange can break.
That pressure is why many investors request listing access early. You need real replacement options to review while the window is open, not after it closes.
Like-kind replacement (including DST)
The replacement has to meet like-kind and other IRS requirements. Buying another rental you have to manage is one option. Delaware Statutory Trust (DST) interests and other structures may also qualify, depending on the offering and your facts. Confirm fit with your advisors.
If you're done being the landlord, DST and other 1031-eligible replacements are often what people look at so they can stay deferred and step out of day-to-day management.
What to do next
Register to view current DST and 1031-eligible replacement offerings.
Register to view current DST and 1031-eligible replacement offerings.
Minimum investment is $100,000. In-house QI included.
Educational only — not tax, legal, or investment advice. Some replacement interests are securities offered only through official documents to investors who meet accreditation and suitability standards.