Like-Kind Exchange

When one investment property used for business purposes is replaced with another property used for business purposes. Like-kind refers to the use of the property, not the asset class.

Like-Kind Property

Property that falls within IRC guidelines to be suitable for a 1031 Exchange transaction

1031 Exchange Rules

  • Property must be like-kind real estate
  • Real estate must be used for investment or business, and not be considered stock in trade or personal property
  • Property replaced must be of equal or greater value to the property being relinquished
  • Boot must not be received by the seller
  • Title of the relinquished property and the replacement property must be in the same taxpayer name
  • Replacement property must be identified within 45 days of closing on the sale of the relinquished property
  • Replacement property must be purchased within 180 days of closing on the sale of the relinquished property.