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1031 Real Estate Exchanges

Use GR Robbins & Associates, P.A. as your Qualified Intermediary for 1031 Real Estate Exchanges.

Thanks to IRC 1031, a properly structured exchange allows an investor to sell a property, to reinvest the proceeds in a new property and to defer all capital gain taxes. Investors need independent intermediaries to handle and escrow the funds gained in a real estate transaction. Proceeds are held in an interest bearing escrow account until the secondary property is purchased. 1031 Real Estate Exchanges protect investors from capital gain taxes as well as facilitating significant portfolio growth and increased return on investment.

Here is an example:

  • An investor has a $200,000 capital gain and incurs a tax liability of approximately $70,000 in combined taxes (depreciation recapture, federal and state capital gain taxes) when the property is sold. Only $130,000 remains to reinvest in another property.
  • Assuming a 25% down payment and a 75% loan-to-value ratio, the seller would only be able to purchase a $520,000 new property.
  • If the same investor chose to exchange, however, he or she would be able to reinvest the entire $200,000 of equity in the purchase of $800,000 in real estate, assuming the same down payment and loan-to-value ratios.

Using one of the tax professionals at GR Robbins & Associates as your Qualified Intermediary will give you the peace of mind and security you need when completing such transactions.