To all of our Clients and Associates, Greetings and Happy Holidays!
At the close of another year, I gratefully pause to wish you a warm and happy Holiday Season. I know that I speak for the entire Asset Preservation family in saying THANK YOU for another great year of working together to achieve our mutual goals. Speaking of closing the year…what a close it was! I can’t remember one quite as interesting as this one!
Since you are reading my message, I know that you will be interested to know, if you don’t already, that as a result of the outcome of the election, our beloved tax code Section 1031 is in jeopardy. The tax deferred exchange looms in the uncertainty of whether or not tax reform is enacted and if so, what if any change to 1031 exchanges it may contain. If you would like to help preserve 1031 exchanges, visit 1031taxreform.com/take-action.
I will be sure to send you more information as it becomes available on this important issue, but until then, have a wonderful holiday and a Happy New Year!
Javier G. Vande Steeg, President
Section 1031(f) restricts tax-deferred exchange treatment in the situations where there is a 1031 exchange between related parties. Moreover, Section 1031(f)(4) states that non-recognition treatments does not apply to any exchange which is part of a transaction or series of transactions structured to avoid the purposes of Section 1031(f). Read More…
Farms Would Be Hurt: Small businesses, farmers, real estate investors and new businesses that need debt capital to grow their businesses and provide jobs would be hurt significantly if Section 1031 Exchanges and business interest expense deductions are eliminated from U.S. tax code. Read More…
The time frame a taxpayer has to complete the acquisition of a replacement property in a 1031 exchange ends at midnight on the earlier of the 180th day after the date the relinquished property was transferred –or– the due date (including extensions) for the income tax return for the taxable year in which the transfer of the relinquished property occurs. (U.S. Treasury Regulations Section 1.1031(k)-1(b)(2)). Consequently, some taxpayers closing on the sale of relinquished property late in 2015 may need to file for an extension to utilize the entire 180-day exchange period. As a general rule, exchangers should not file a tax return until the 1031 exchange is complete.
More specifically, if the 180th day following the closing of the sale of the first relinquished property falls after the due date for filing the 2015 tax return (generally April 15, 2016, for individuals), a taxpayer must file an Application for Extension of Time (IRS Form 4868) with the IRS to extend the filing date. If a taxpayer does not file for such an extension, they will not be able to acquire any replacement property in an exchange after the tax return due date. If you have any questions, please call your Exchange Counselor at Asset Preservation at National Headquarters (800) 282-1031 or Eastern Regional Office (866) 394-1031.
Join an advanced 1031 exchange webinar for tax and legal advisors (CPE credit available) on Thursday, January 12th at 11:00 a.m. EST. This webinar tackles advanced issues such as reverse and improvement exchanges, related party issues, and how to avoid common pitfalls. You will receive a summary of current developments regarding possible tax reform and the implications on 1031 exchanges. Sign Up…
We Need Your Help to Preserve §1031 Exchanges.
Get involved today! With a new incoming Republican Presidential Administration and both houses in Congress also Republican, the likelihood of a new tax reform bill is almost a certainty. To pay for lower tax rates, there have been proposals to eliminate Section 1031 like-kind exchanges from the tax code. 1031 tax deferred exchanges benefit millions of American investors and businesses every year. 1031 exchanges encourage businesses to expand and help keep dollars moving in the U.S. economy. The repeal of 1031 exchanges would lead to negative consequences for the real estate market, the national economy and would lead to lower property values, economic contraction and job loss. 1031 exchanges are relied on by small businesses and investors in many industries, including real estate, transportation, equipment/vehicle rental/leasing, and construction. Tell your Congressional representatives that 1031 exchanges are vitally important to both the commercial and residential real estate markets and the overall U.S. economy. Go to 1031taxreform.com to learn more and save 1031 exchanges.
Asset Preservation would appreciate the opportunity to work with you on your next exchange regardless of how simple or complex. Give us a call at 800-282-1031 with any 1031 related questions or Open a 1031 Exchange Online.
Small businesses are the backbone of the American economy because they account for 99.7 percent of all U.S. employers. As Black Friday has become a shopping bonanza, a new concept, “Small Business Saturday,” encourages consumers to buy items from their local shopkeepers. Read more…