Tax Analysts provides news, analysis, and commentary on tax-related topics, including like-kind exchange rules and requirements under section 1031. These “1031 exchanges” allow for disposal of certain business or investment property and acquisition of like-kind property as replacement property without generating tax liability.
Rules regarding what constitutes “like-kind property” are generally broad, unless they are not, in which case guidance and case law fill in the blanks. (e.g. North Central Rental & Leasing LLC et al. v. United States (8th Cir.); "Taxpayer May Rematch Properties in Like-Kind Exchange" (TAM 201437012)) Replacement property for relinquished property must be of the same nature or character and must be designated, time limits on 1031 like-kind exchanges are specific, and personal property generally is not subject to non-recognition treatment under section 1031, unless the property is a vacation home and taxpayers meet specific rules.
A taxpayer’s intent to make a like-kind exchange may be determinative, since a purpose of tax avoidance may make the exchange taxable. Special rules apply to 1031 exchanges between related parties. Under certain circumstances, part of an exchange may be non-taxable, while another part is not.
Such property swaps are often facilitated by a qualified intermediary, who must be careful not to facilitate an exchange such that the intermediary is considered a disqualified person. These and related aspects of like-kind exchanges are addressed in the documents, news stories and commentaries that Tax Analysts publishes.
Tax Analysts consistently and promptly publishes all relevant developments regarding like-kind exchange rules and requirements. To stay up to date on all tax-related topics, subscribe to Tax Notes Today Federal.
