The Basics of Section 1031 Like-Kind Exchanges

INTRODUCTION

            In April 1992, Banker Exchange, LLC (formerly Boyd Corporation) opened its doors as the first, full-service qualified intermediary in the state of South Carolina.  Banker Exchange, LLC has assisted CPAs, attorneys, real estate professionals and their clients nationwide by providing a full range of qualified intermediary services for tax-deferred exchanges under Section 1031 of the Internal Revenue Code.

            In general, IRC §1031 provides that no gain or loss is recognized (and therefore no income tax is due) on the disposition of property held for productive use in a trade or business or for investment, provided that the property is exchanged solely for property of a like-kind to be held for the same purpose.  Although on the surface this seems to be a very straightforward process, nothing is simple with the IRS.  There are an abundance of administrative requirements and strict rules regarding IRC §1031 exchanges.  At Banker Exchange, LLC, we have a combined quarter-century of experience with tax-deferred exchanges, and have researched the IRS Regulations intensively, developing procedures and documents which help to ensure that the transactions will withstand IRS scrutiny.

            While we recognize this information is not an exhaustive treatment of like-kind exchanges, we believe it will serve as a good starting point for any issues you may confront.  We thank you for your participation in today’s seminar and welcome the opportunity to discuss the benefits that may be available to you through a tax-deferred exchange. If we can provide any assistance or information on a particular exchange, please do not hesitate to call on us.