1031 Exchange refers to Section 1031 of the IRS tax code, and is a strategy by which a real estate investor can deffer paying tax on capital gains*. 
Bill Salvatore and the Your Valley Property Team
wish to thank Rick Wittstock of IPX 1031®
for providing the following information on 1031 Exchanges.
The transaction must be properly structured and handled by a qualified intermediary.** In general, to qualify as an exchange;
- Properties must meet the 1031 regulation’s definition of “like kind”.
- A 1031 must be set up BEFORE the relinquished property transfers. The Qualified Intermediary must assign into the contract. Otherwise there is a taxable sale.
- All proceeds from the relinquished property must be used to purchase the new investment i.e. purchase must be of equal or greater value.
- Obtain equal or greater debt.
- Both relinquished and purchased property must be ‘real property’.
- Purchased property mush be held for productive use.
Slide of 1031 allowable property types provided by Rick Wittstock of IPX 1031®
Advantages of employing the 1031 exchange are numerous:
- Defer taxes (up to 35-40% of gain).
- Greater purchasing power.
- Expand into other real estate markets nationwide.
- Improve cash flow.
- Greater appreciation potential.
- Diversify or consolidate real estate portfolio.
- Switch property types.
- Build and preserve wealth.
- Estate planning for heirs.
Practical suggestions for 1031 exchange from Rick Wittstock of IPX 1031®
Please contact us for additional information regarding 1031 Exchange
602.999.0952 · billAZElite@cox.net · Or submit the form below
*It is strongly recommended that you employ a professional Qualified Intermediary to facilitate the 1031 exchange as the details and nuances of the process might easily be misinterpreted or mismanaged.
**You are advised to consult a tax or legal expert prior to entering into an exchange as it is possible for an investor to have little or no equity or profit upon sale, and still owe capital gain taxes.
For more information, Call or Text: 602-999-0952
eMail: golfarizona@cox.net
Bill Salvatore / Arizona Elite Properties
Your Valley Property Team
Residential Sales, Marketing, and Property Management
Founder: AZVHV Arizona Veterans Helping Veterans
Member: Heroes Home Advantage
Recipient: East Valley Tribune’s: Best Gilbert Realtor
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