TRADE APPLES FOR APPLES;
KEEP MORE OF YOUR GREEN!

YOU PURCHASED A RENTAL PROPERTY and properly maintained it over the years. You've had good tenants and kept the building repaired and in excellent shape. And now your hard work pays off—the property is worth much more than you originally paid for it.

However, if you simply sell the property, you'll owe taxes on your gain or profit. Even worse is the way the government defines your gain. If you bought the property for $75,000 and sell it for $150,000, you not only owe tax on that difference, but you also owe tax on an additional amount, depending on the property's depreciation. All this tax may just motivate you to hold on to your property. BUT...you can avoid paying tax on your profit when you sell a rental property then buy other business or investment real estate with the proceeds under 1031, thereby rolling over your gain. The section of the tax code that allows rollovers is a 1031 exchange. (NOTE: You can't receive the proceeds; they must go into an escrow account.)

The rules for properly performing a 1031 exchange are complex. A third party is usually required. As an IRS 1031 Qualified Intermediary, Commerce Title Exchange is expert at these transactions, with the experience and knowledge to ensure your transaction is handled smoothly and to the letter.

Click here for frequently asked questions regarding Section 1031 exchanges.

Commerce Title Exchange, LLC is a Qualified Intermediary and is precluded from giving tax or legal advice. You must consult with your tax of legal advisor about your specific circumstances.