1031 Exchange Options

 

In a 1031 exchange, one can exchange any real property for any other real property within the United States or its possessions, if the properties are held for productive use in trade, business, or for investment purposes and are like-kind properties. Examples of qualified like-kind exchanges can be an apartment building for farm/ranch, an office building for hotel, or an unimproved property for commercial property.

Exchange options are varied and can involve reverse exchanges, construction (improvement) exchanges, oil-gas exchanges, aircraft exchanges, or personal property exchanges.

The reverse exchange provides greater flexibility in structuring the exchange. This code doesn't allow for an exchanger to exchange into a property that is already owned. But reverse exchange offers the provision of closing on a replacement property, while still trying to sell the old property. There are various options in this exchange like the safe-harbor reverse, traditional reverse, construction/improvement, and the reverse leasehold improvement reverse.

Safe-harbor is a transaction whereby the accommodator takes control of the replacement property prior to the sale of the old property. Time frame provided is 180 days before which the transaction should be completed. Traditional reverse is a reverse exchange that typically looks identical in structure to the safe-harbor reverse, yet it will fall outside of the safe-harbor due to the fact that it cannot be completed within the time frame provided. Construction/improvement is a type of reverse exchange that allows the exchanger to park a piece of property or land that will be built upon or improved during the exchange period. This is the most powerful reverse exchange available for development or construction process. Leasehold improvement reverse is an exchange whereby the exchanger will actually build on property they already own, treating the building as the parked property.

Personal property or aircraft exchange deals with like-kind exchanges personal property or aircrafts respectively. Oil-gas exchanges are mineral or drilling equipment exchanges.1031 Exchange provides detailed information on 1031 exchange, 1031 exchange companies, 1031 exchange experts, 1031 exchange forms and more. 1031 Exchange is affiliated with 1031 Tax Exchange Opportunities.