Explanation of the Workings of a 1031

Developed in the 1920’s, 1031 tax exchange is the most popular and commonly used financial remedy in order to sell one real estate property in exchange of another.

This is proven by the fact that 1031 tax exchange does not deal with any tax return filing involved in the replacement transaction.

1031 tax deferred exchange comes under Internal Revenue Section 1031. It was developed for tax payers who have their properties spread out in different areas, such as business barons and tycoons who take keen interest in selling and re-selling of a series of properties. Currently, it proves to be a pure assistance and a wealth generation tool for all tax payers. 1031 tax deferred exchange merely deals with selling of one asset, such as a real estate property, income or any kind investment in exchange of another similar asset. (more…)