Real Estate Investors Breathe a Sigh of Relief by Christopher Sanz, JD, LLM

Posted on October 18, 2021

Absent from the latest draft of tax legislation making its way through Congress is any mention of Section 1031 exchanges, which for decades have allowed passive investors to defer taxes on the sale of commercial property when proceeds are reinvested in a similar, like-kind property. Previously, the president had called to eliminate the tax break on gains exceeding $500,000 for individual taxpayers or $1 million for married couples filing joint tax returns. While it appears that 1031 exchanges are safe for now, investors should still pursue exchanges in the works and consider expediting them before prosed tax increases and reductions to the estate tax take effect as early as 2022.

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