Commercial Properties By SaulLike Kind Example - Condo Warehosue to Free Standing Warehouse

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1031 Exchange Like-Kind Examples

1031 Exchange - Like-Kind Examples:

Ranch or Farm
Hotel or Motel
Warehouse Building
Apartment Building
Retail Building
Duplex
Single Family Rental
NNN Investment Property
Office
Building
Raw Land

Like-Kind

Like Kind Example small warehosue to large warehouse

Like-Kind

Like-Kind

There must be an exchange of like-kind property. Like-kind properties are properties of the same nature or character, even if they differ in grade or quality. The exchange of real estate for real estate and the exchange of personal property for similar personal property are exchanges of like-kind property. For example, the trade of land improved with an apartment house for land improved with a store building, or a panel truck for a pickup truck, is a like-kind exchange.
An exchange of personal property for real property does not qualify as a like-kind exchange. For example, an exchange of a piece of machinery for a store building does not qualify. Also, the exchange of livestock of different sexes does not qualify.

Real property. An exchange of city property for farm property, or improved property for unimproved property, is a like-kind exchange.
The exchange of real estate you own for a real estate lease that runs 30 years or longer is a like-kind exchange. However, not all exchanges of interests in real property qualify. The exchange of a life estate expected to last less than 30 years for a remainder interest is not a like-kind exchange.

An exchange of a remainder interest in real estate for a remainder interest in other real estate is a like-kind exchange if the nature or character of the two property interests is the same.

When making a purchase agreement (for review purposes only, this is not legal or tax advice, please have your tax and or legal adviser and or attorney review any and all contract language ), it is advisable to add "and or assigns", to express, that you may have assigned certain tasks to others (like a Broker, Qualified Intermediary, etc), which maybe required to be performed by you, specifically, in the agreement. Also, it is important to add cooperating or cooperation clauses; and in addition stating that this transaction is a part of 1031 Tax Deferred Exchange, and that by the purchaser or seller recognizing this, and the 1031 processes, by signing the agreement, and that by signing, they are required to cooperate with both you and your "assigns."

For review purpose only, here are some possible ways to express that this is a 1031 purchase:

(This is not legal or tax advice, please have your own tax and or legal and or attorney and or accountant and or Broker and or Qualified Intermediary, and all of your own advisers to review any and all contract language, and rely solely on your research, advisers, and rely exclusively on those results .)

Seller hereby acknowledges that Purchaser has the option to qualify this transaction as part of a tax deferred exchange and transfer this property through the use of a Section 1031 Tax Deferred Exchange of the Internal Revenue Code. Seller agrees that Purchaser may assign its rights and obligations under this agreement to a Qualified Intermediary and or an Exchange Accommodation Titleholder as necessary to facilitate such exchange. Seller agrees to cooperate in a manner necessary, to enable the Purchaser and or its assigns, in order to complete said exchange; which will neither cause additional expense or liability to the Seller.

Purchaser hereby acknowledges that Seller has the option to qualify this transaction as part of a tax deferred exchange and transfer this property through the use of a Section 1031 Tax Deferred Exchange of the Internal Revenue Code. Purchaser agrees that Seller may assign its rights and obligations under this agreement to a Qualified Intermediary and or an Exchange Accommodation Titleholder as necessary to facilitate such exchange. Purchaser agrees to cooperate in a manner necessary, to enable the Seller and or its assigns, in order to complete said exchange; which will neither cause additional expense or liability to the Purchaser.