1031 Exchanges Help the Economy During COVID-19 Pandemic

The Federation of Exchange Accommodators (FEA), the only national trade association representing the 1031 exchange industry, just released Section 1031: Sustaining American Businesses During Economic Uncertainty. This flyer highlights the many benefits of 1031 exchanges to help the national economy during the COVID-19 pandemic. A few highlights are noted below:

• 1031 exchanges allow businesses and investors to increase their returns by moving into more productive property, relocating to another location, diversifying or consolidating.
• Small business owners and middle-class taxpayers use 1031 exchanges to transition into facilities that more efficiently meet their needs, instead of being-locked in inefficient properties.
• 1031 exchanges encourage capital investment for the highest and best use of real estate, thus improving communities and increasing the local and state tax base.
• 1031 like-kind exchanges help repurpose retail and office space, allowing capital to efficiently flow to where it’s most needed.
• 1031 exchanges generate jobs and taxable revenue for many ancillary industries including real estate agents, title and property insurers, escrow/settlement agents, lenders, appraisers, surveyors, attorneys, inspectors, contractors, building supply vendors and more.
• Farmers and ranchers use 1031 exchange to relocate, consolidate or improve their operations without diminishing cash flow.

1031 exchanges are used in conservation easements to improve water quality, reduce soil erosion, maintain wetlands and sustain critical wildlife habitats.

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