1031 Like-Kind Exchange*
Defer Capital Gains With a 1031 Like-Kind Exchange
If you're planning to sell real or personal property currently held for investment or productive use in a trade or business and purchase another one, you may want to take advantage of the benefits of a 1031 like-kind exchange. Under Section 1031 of the Internal Revenue Code, investment or business property owners -- using a Qualified Intermediary -- can sell one qualified property and purchase a similar qualified "like kind" property while deferring capital gains. Capital gains taxes on the sale of the "relinquished" property are deferred until the "replacement" property is sold at a future date.
Property that is eligible for 1031 exchanges
Benefits of a 1031 exchange
Access to a Qualified Intermediary
Contact us for more information about 1031 exchanges
Property That Is Eligible for 1031 Like-Kind Exchanges
Below are the types of property that are considered eligible for 1031 exchanges:
- Real property. All real property in the United States that is held for income, investment or business use, and whether improved or unimproved, is "like kind," including land, apartments, office buildings and retail space.
- Personal property. Defining like-kind for personal property exchanges is more challenging than it is for real property exchanges. The properties being exchanged must be in the same general asset class or product class. Examples of personal property that may be exchanged under Section 1031 include aircraft, yachts and others.
Benefits of a 1031 Like-Kind Exchange
Using the 1031 like-kind exchange gives you:
- No immediate capital gains tax obligation and potential avoidance of depreciation recapture
- Improved cash flow through the deferred payment of capital gains tax
- Consolidation or diversification of business or investment property holdings without paying tax on capital gains
- The ability to leverage all equity into the purchase of replacement property
Access to a Qualified Intermediary
Wachovia Securities' Financial Advisors have access to a dedicated staff of professionals at Wachovia Bank whose job function is focused entirely on providing services for Section 1031 tax-deferred exchanges nationwide. These professionals are committed to providing the highest level of service and expertise to guide you and your advisors through the entire 1031 like-kind exchange process.To take advantage of a 1031 like-kind exchange, you must use a Qualified Intermediary in the transaction. Our affiliates at Wachovia Bank, N.A., can provide this necessary service for you.
Contact Us for More Information About 1031 Like-Kind Exchanges
For more information, contact a Wachovia Securities Financial Advisor.*1031 like-kind exchanges available through Wachovia Exchange Services are offered through Wachovia Bank, National Association, a separate affiliate of Wachovia Securities, LLC, and subsidiary of Wachovia Corporation.
Wachovia Securities does not provide legal or tax advice. Be sure to consult with your own tax and/or legal advisor before taking any action that would have tax consequences.
This communication is not a covered opinion as defined by Circular 230 and is not intended or written to be used, and cannot be used, or relied on, by the taxpayer, for the purpose of avoiding federal tax penalties. This communication was written to support the promotion or marketing transaction(s) or matter(s) addressed in the written communication; and the taxpayer should seek advice based on the taxpayer's particular circumstances from an independent tax advisor.
Lending and other banking services available through the Banking Services Group of Wachovia Securities are offered by banking and non-banking affiliates of Wachovia Corporation, including, but not limited to Wachovia Bank, National Association; Wachovia Bank of Delaware, National Association; or Wachovia Financial Services, Inc. All loans and lines of credit are subject to credit approval, verification and collateral evaluation. Initial decision is subject to you meeting specific underwriting requirements and final approval will be based upon your satisfying those requirements.
