1031 Exchange: Navigating Your Way to Wealth
We demystify the 1031 exchange—explaining how it works, highlighting its key benefits, and showing you how to use it to grow your real estate portfolio while keeping more of your capital working for you.
Whether you're a seasoned investor or new to the game, understanding the strategic advantages of a 1031 exchange can be a powerful tool for building long-term wealth.
6 Reasons Smart Investors Choose 1031 Exchanges
Build Wealth
Deferring capital gains taxes allows investors to reinvest more capital into higher-value properties, facilitating increased wealth accumulation.
Improve Cash Flow
Investors can exchange properties for those with higher rental income, enhancing their monthly cash flow.
Purchase Power
By deferring taxes, investors can utilize the full sales proceeds to acquire more valuable or additional real estate assets.
Diversify Real Estate Portfolio
A 1031 exchange enables diversification by allowing investors to trade properties in different markets or sectors, reducing risk.
Preservation of Equity
Deferring taxes helps preserve equity from property sales, allowing for reinvestment into new properties without losing capital.
Estate Planning
Properties passed to heirs may receive a step-up in basis, allowing them to avoid capital gains taxes, thus preserving wealth for future generations.
The Many Faces of 1031 Success
Our monthly spotlight of the wide range of people and entities who are using this powerful tax strategy to build wealth.
Agility in Acquisition: How Reverse 1031 Exchanges Secure the Perfect Deal
A reverse 1031 exchange lets you buy replacement property first while deferring capital gains tax—but the structure must exist before you close on the new asset.
The Failure of 'Commodity' QIs: Using Attorney-Led Compliance to Secure Your Exchange
Budget QI selection can cost up to 40% of your property gains in taxes. Use this 10-question checklist to vet fund controls before your exchange closes.
Texas 1031 Exchange Rules: What Houston Investors Need to Know
The 45-day and 180-day 1031 deadlines are federal, but Texas mineral rights and Houston's fast closings require early QI setup to avoid constructive receipt.
Why Your Title Company’s Affiliate QI Puts Your Exchange at Risk
Title company affiliate QIs may prioritize closing speed over fund controls. Verify segregated accounts and wire authorization before signing to avoid constructive receipt.
How to Choose a Qualified Intermediary: 5 Security Questions to Ask
Protect your 1031 exchange by asking five security questions about fidelity bonding, segregated accounts, and constructive receipt controls before signing with a QI.