Autumn 1031 Exchange Update
As we approach Thanksgiving Day, we want to extend our warmest wishes to you and your loved ones. May your homes be filled with laughter, your hearts with joy, and your tables with the bountiful blessings of this season. We are thankful for the relationships we’ve built with each of you and look forward to continuing to serve you with the highest level of professionalism and expertise.
Thank you for choosing Asset Preservation, Inc. as your partner in 1031 exchanges. Wishing you a Thanksgiving filled with warmth, happiness, and cherished moments with family and friends.
Happy Thanksgiving!
2023 Year-End Tax Planning
Exchanges Over Two Tax Years May Be Treated As An Installment Sale
In a delayed exchange transaction structured to satisfy the requirements of §1031, an exchanger has up to 180 calendar days to acquire like-kind replacement property measured from the day the relinquished property is sold. Once initiated, the delayed exchange may be successfully completed (resulting in complete tax deferral), partially completed (resulting in recognition of some capital gain) or it may fail if no like-kind replacement property is acquired (resulting in the recognition of all capital gain generated by the sale). If the exchange begins in one tax year and extends into the subsequent tax year, the question arises whether the gain realized on the sale is recognized in the year in which the relinquished property was sold or in the subsequent year in which the exchanger received the cash sale proceeds from the qualified intermediary.
In a perfect world, gain would be recognized in the subsequent year when the proceeds were actually received by the exchanger. In many cases, this turns out to be wholly or partially true.
Don’t miss The Ultimate Tax & Legal Conference with Asset Preservation’s Scott Saunders for 3 days of cutting-edge 1031 exchange tips and other tax strategies. Mention “SCOTT15” for 15% off.
Important Information for Investors Beginning an Exchange
From October 17 – December 31, 2024
If your 1031 exchange is not complete by the due date for your tax return, you may need to file for an extension.
The time frame you have to complete the acquisition of your replacement property ends at midnight on the earlier of: (a) the 180th day after the date you transferred the relinquished property; OR (b) the due date (including extensions) for your 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)).
This means, if your relinquished property sale closes after October 17, 2024, your 180th day deadline to acquire replacement property will fall after the common 2024 tax return due date of April 15, 2025. In order to receive the full 180-day period to acquire replacement property, you must file an application for extension of time with the IRS to extend the due date for your 2024 tax return. If you do not file for an extension, you will NOT be able to acquire any replacement property in your exchange after your tax return due date. Taxpayers may have different tax return due dates. Please consult with your tax advisor to determine your tax return due date, and whether you will need to file for an extension.
If you have any questions, please contact your tax advisor.
National Headquarters: 800-282-1031
Eastern Regional Office: 866-394-1031
We Love Our Happy Customers
This is the second time I have used Asset Preservation within a year to facilitate a 1031 exchange. I recommend this group without reservation. They communicated clearly and efficiently to keep me apprised of all the steps.
Could not be happier!
– Silvija A., Massachusetts
1031 Exchange Webinars
Friday, December 15th
1:00 PM – 3:00 PM CT
CE / CPE Available
This two-hour course for commercial brokers provides a concise and thorough overview of 1031 exchanges. This webinar tackles advanced issues such as partnership/LLC scenarios, creative property variations such as perpetual cellular easements (cell towers), fractional ownership, transferable development rights, reverse and improvement exchanges, how to avoid common pitfalls and related-party transactions.
Monday, December 4th
10:00 AM – 11:00 AM CT
CPE Available
This one-hour intermediate/advanced webinar covers critical time deadlines, like-kind requirements, fractional ownership, oil/gas/mineral rights, related party transactions, partnership/LLC scenarios, reverse and improvement exchanges, and how to avoid common pitfalls.
Federally Declared Disaster Extension Information
Click the link below to determine if you may qualify for an extension.
https://www.irs.gov/newsroom/tax-relief-in-disaster-situations
Additional information here: https://apiexchange.com/disaster-relief/
Call Us
Asset Preservation would appreciate the opportunity to work with you on your next 1031 exchange. Give us a call for a free consultation.