If you own income or investment property, you probably already know that a sale of income property can result in the following tax liabilities:
•15% Federal Capital Gains Tax
•25% Depreciation Recapture Tax
•9.3% State Capital Gains Tax
In general people who cash out of investment/income producing property can expect to pay approximately a third of their gain/profit in taxes! Luckily, Section 1031 of the Internal Revenue Code offers investment property owners the ability to defer taxes (and possibly avoid them altogether) by doing a 1031 exchange.
In my 25 years in real estate, I have help dozens of clients facilitate a 1031 exchange representing them in either the list, purchase or both.