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President Biden has proposed limiting 1031 exchange tax deferral to a maximum of only $500,000 of gain. This proposal will result in a severe negative impact on investment real estate, the economy, significant job loss and reduced transactional activity.
You can help. Tell Congress to keep 1031 exchanges.
Click on the button above to send an email to your representatives in Congress.
Asset Preservation, Inc. (API) opposes President Biden’s proposal to limit IRC Section 1031 exchange deferral to a maximum of $500,000 of gain. This proposal would effectively eliminate commercial real estate exchanges, as well as many farm and ranch exchanges, and many other exchange transactions.
- Recent research by EY has estimated that 1031 exchanges are expected to generate 568,000 jobs this year, including $27.5 billion of labor income, and a total of $55.3 billion of value added to the US economy.
- Section 1031 tax-deferred exchanges encourage real estate transactional activity and stimulate the national economy.
- 1031 exchanges are used by a broad range of taxpayers: from middle-class individuals exchanging rental houses and small apartment buildings, farmers, ranchers, small to mid-sized businesses, as well as larger taxpayers exchanging commercial properties in major metropolitan areas.
- Studies show that 1031 exchange buyers invest significantly more capital in replacement properties than do non-1031 exchange buyers.
- Higher valued commercial real estate exchanges are an important source of jobs for contractors, skilled and unskilled blue-collar workers, lenders, real estate brokers, title insurers, escrow companies, surveyors, appraisers, architects, landscapers, building material suppliers, and more. The income earned by these workers generates tax revenue and consumer spending, furthering a positive economic impact nationwide.
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