M id A tlantic 1031 E xchange Fast-Tracked Legislation, Took Effect January 1 Under Tax Reform, A new landscape for Section 1031
Real Estate Journal — Financial Digest — 1031 Exchange — March 16 - 29, 2018 — 11A
www.marejournal.com
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Unfortunately, the repeal of personal property exchanges does leave some assets ineli- gible for deferral under Section 1031 or for immediate expens- ing. These assets include: • Franchise agreements • Distribution rights • Liquor licenses • Artwork, collectibles and antiques The Role of Qualified Intermediary The legislation also preserved the role of the qualified inter- mediary (QI). The QI plays an important role during the exchange process by helping guide the taxpayer and their advisors through the exchange process. In additional to pre- paring the pertinent exchange documentation and safeguard- ing the exchange proceeds, QI’s also keep the taxpayer aware of the time deadlines and the
identification rules, coordinate with the closing agents and help ensure he transaction is completed pursuant to Trea- sury requirements. The QI also communicates with the taxpayer’s legal and tax advi- sors regarding these important requirements. Members of the Federation of Exchange Ac- commodators (FEA; www.1031. org), the national trade associa- tion for exchange practitioners, have access to the latest tax court decisions, private letter rulings (PLRs) and other rel- evant legal and tax guidance. Thank You The leadership and members of the FEA are grateful to all who supported the effort to pre- serve 1031 like-kind exchanges. Teresa Person, CES ® is president of Federation of Exchange Accommoda- tors. n
resident Trump signed the Republican tax re- form bill into law on
changes for real estate are preserved. • 1031 exchanges of all per- sonal property assets are eliminated. • The role of the Qualified Intermediary is preserved. Impact on Section 1031 1031 exchanges for real prop- erty have been preserved which includes all real property used for business or held for invest- ment purposes Section 3303 of the bill, how- ever, repeals exchanges for all personal property, including but not limited to machinery, equipment, vehicles and air- craft. New and used assets acquired and placed in service after September 27, 2017, and before January 1, 2023 will be eligible for 100% immediate expensing. After the first five years, this immediate expens- ing will begin to phase out.
December 22, 2017. After years of wor- rying about the future of Section 1031 like-kind ex- changes, the rea l es tat e industry was
Teresa Person
offers new tools for taxpayers and businesses. The legislation retains Section 1031 like-kind exchanges for real property assets and the vital role of the qualified intermediary (QI), but eliminates exchanges of all personal property. The law took effect on Janu- ary 1, 2018. The following summarizes the impact of tax reform on 1031 like-kind ex- changes: • Section 1031 like-kind ex-
fortunate Section 1031 survived but it came with significant modifications. 1031 exchanges provide many economic benefits that help create jobs and con- tribute meaningfully towards economic growth. The Tax Cuts and Jobs Act is the first major overhaul of the U.S. tax code since 1986. The controversial new law reduces tax rates, redefines tax rules and accounting methods, and
Edward Fernandez 1031 CrowdFunding, LLC
Alan Fruitman www.1031tax.com
Diane Schaefer EXCHANGE SOLUTIONS
Eric Nelson Woloshin Investment Management
Inside:
Eric Nelson, Woloshin Investment Management..................................................................................................... 12A Edward Fernandez, 1031 CrowdFunding, LLC......................................................................................................... 14A EXCHANGE SOLUTIONS............................................................................................................................................ 15A Stonecrest Partners.................................................................................................................................................... 16A Alan Fruitman, www.1031tax.com............................................................................................................................. 17A
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