The questions here were received from interested 1031 exchangers visiting my website. I have chosen to leave the questions intact with their ambiguity, shorthand writing and misspellings so as not to act on the assumption as to what when unclear the questioner meant.
Like Kind Exchange – Asset Class, Part 2
Many people have a question when they hear about a 1031 exchange for the first time – they’re asking about what constitutes a ‘like kind’ property.
A ‘like kind’ property refers to real property including what individual states define as real property such as timber and mineral rights from which you can facilitate 1031 exchanges. Geographically the definition is limiting to U. S. , U.S. Virgins Islands and Guam. If you own a property outside of the U.S. you have to exchange that property with another foreign property — France to Mexico, etc.
Question 1:
Hi! I have a couple questions. I have 2 single family rentals in Denver Colorado. 1) Can I exchange the TWO of them TOGETHER for ONE rental in California (since property there is so much more expensive). 2) can the rental in California be a condo or must it also be a single family residence? Susan
Answer:
In certain cases, you can exchange two properties for one. Various 1031 guidelines apply, but your condo being real property, you may be able to combine the properties to make the deal.
Question 2:
I personally own my doctors office in a coop building (shares) I rent it to my medical corporatiion, I am selling the coop and want to by a condominium apartment for the purpose of renting it. Is this like kind exchange?
Answer:
In New York, these types of deals can often pass as like kind. Look at the specific details of the co-op building’s setup and whether it represents like kind with a condominium apartment.
About Marilee: Role of Marilee Hill, Registered Representative (RR)
Want the best trusted 1031 exchange advice? Call Marilee Hill. She has experience in property management and real estate – understanding all of the alphabet soup involved in the real estate process, such as Delaware Statutory Trusts and other obscure elements of 1031 exchanges.
She also knows that real estate is, at its root, based on people. Let Marilee Hill help you to deal with sponsors and brokers and other stakeholders in a personable and professional manner.
Please contact Marilee Hill for your next 1031 Exchange strategy.
