Under President Biden’s April 28th tax proposals, two would affect the world of 1031 Exchange’s. Under these two proposals, Section 1031 would be modified to:
- Eliminate the use of Section 1031 for deferring gains over $500,000.
- Eliminate the step-up cost basis at death.
Since 1921 1031 Exchanges have been a vital part of the U.S. Tax Policy. They have been credited with:
- Increasing Investment in Real Estate.
- Increasing Deal Velocity in Real Estate.
- Allows many small businesses and investors to expand and grow.
The potential combined effect would drastically reduce business activity for 1031 Exchanges and commercial real estate transactions. Prices for commercial/investment properties would be diminished.
If you would like to discuss how these proposed changes will raise issues for your business and/or investment give us a call, (631) 421-4341.
Support the Retention of 1031 Exchanges Today!
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