Benefits of a 1031 Like-Kind Exchanges

holding money

You can make the most of your real estate investments by leveraging the power of a 1031 exchange. A like-kind exchange allows you to defer real estate taxes and roll those savings back into your business - and back into your pocket! At 1031 Exchange Connection, we specialize in facilitating exchanges for all types of real estate investors in Florida and across the Unites States. We'll determine what type of 1031 exchange will work best for your situation so you can skip the capital gains taxes on your next real estate investment.

Learn about all the benefits of exchanges below. Then call us at 239-659-1031 now or request your free consultation. Or, if you're ready you can start an exchange online now.

Defer Capital Gains Taxes

The main reason real estate investors do a 1031 exchange is to avoid paying tax on the sale of their property and instead use that cash as equity in purchasing a new like-kind property. The tax is not eliminated but "deferred" until sometime down the road when the new property is sold. Learn more about how 1031 exchanges work.

Increase Cash Flow

Instead of holding appreciated land or other non-income producing real estate, investors can exchange them for income-producing properties. This increases cash flow, builds wealth, and enables them to live a better lifestyle, especially when heading into retirement years.

Diversify Your Portfolio

Every smart investor knows not to keep all the eggs in one basket. If you're holding onto highly appreciated property, you can leverage that equity by doing a 1031 exchange into two or more properties. This creates a diversified real estate investment portfolio used to hedge against losses in value of other investments due to location or economic downturns.

Eliminate Property Management Headaches

Managing a large number of rental properties can be difficult and time-consuming. Save time and rid yourself of nasty tenant phone calls with a 1031 exchange. You can consolidate your investments by exchanging multiple properties into one property of greater value and avoid paying tax in the process.

An Estate Planning Strategy

As part of your estate plan, you can legally and effectively minimize estate taxes by adding your children or other beneficiaries on title of replacement properties when you exchange. Through this method, the value of the estate will be shifted to the beneficiaries, eliminating most (if not all) of the estate taxes due when the owner passes.