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CRE Experts Give Forecast On 1031 Exchanges Under Trump Administration

March 9, 2017

CRE Experts Give Forecast On 1031 Exchanges Under Trump Administration

March 7, 2017 | by Cameron Sperance | Forbes

A popular real estate investment vehicle could be in jeopardy under Republican-led tax reform.

The “like-kind” or 1031 exchange was introduced in the 1920s to soften the tax burden on farmers looking to swap land. The rationale went something like this: If a taxpayer receives nothing in the transaction to pay taxes on (it is tied up in the new property), no tax should be owed. It has since morphed into a way for businesses like airlines to save millions by trading in older assets for something newer.

“Political sands shift quickly,” Mount Vernon Co. chairman and founder Bruce Percelay said. “There’s no question the real estate world will be significantly influenced by Trump policies — both positively and negatively.”

Percelay presides over one of the largest apartment landlords in Massachusetts, and he wonders what kind of future, if any, 1031 exchanges have under President Donald Trump’s administration.

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Ramón A. Rivera-Ramos
Blue Vault Nontraded REIT and Nontraded BDC Reviews
September 1, 2016

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