Welcome
Special Education
Disability Trusts
Other Practice Areas
Juvenile & Criminal
Business Law
Personal Injury
Real Estate
Wills & Probate
Bankruptcy
Civil Litigation
Dispute Resolution
Intellectual Property
Estate Planning and Administration
Tools
Seminars
Updates
Resources
FAQ
Contact Us


Why 1031 Exchange?

Any Real Estate property owner or investor of Real Estate, should consider an exchange when he/she expects to acquire a replacement "like kind" property subsequent to the sale of his existing investment property. Anything otherwise would necessitate the payment of a capital gain tax, which is currently 15%, but may go to 20% in future years. Also include the federal and state tax rates of your given state when doing a 1031 exchange. The main reason for a 1031 is that the IRS depreciates capital real estate investments at a 3% per year rate as long as you hold the investment, until it is fully depreciated. When you sell the capital asset, the IRS wants to tax you on the depreciated portion as an income tax, and that would be at the marginal tax rate.