A 1031 Exchange, also known as a Like Kind Exchange or Starker Tax Deferred Exchange (named for an investor who challenged and won a case against the IRS) is a transaction under United States law which specifies under section 1031 of the Internal Revenue Code, 26 U.S.C. § 1031the following:

"No gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment if such property is exchanged solely for property of like kind which is to be held either for productive use in a trade or business or for investment."

This allows taxpayers to defer all of the capital gains taxes resulting from the sale of investment property, when they use a Qualified Intermediary, follow the IRS guidelines, and use the proceeds of the sale to buy more investment property within 180 days of their sale.
(source: en.wikipedia.org/wiki/1031_exchange)

What is its primary benefit? 



Can you exchange raw land for a commercial building or vice-versa?

If you have questions like these...contact David.  

You can also check out these helpful links to locate a Qualified Intermediary.  

http://www.bpa1031.com

http://www.ipx1031.com

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