Yes, you can exchange a property for one of lesser value in a 1031 exchange—but doing so usually creates taxable income called “boot.” A 1031 exchange can still work as a partial tax deferral, but you generally will not defer Continue reading Can You Exchange a Property for One of Lesser Value in a 1031 Exchange?
The short answer is this: a properly structured 1031 exchange can help defer both capital gains tax and the NIIT, but it does not make the tax disappear forever. The NIIT is a 3.8% tax on certain investment income for Continue reading How Does the Net Investment Income Tax (NIIT) Affect 1031 Exchanges?
Credits to Karolina Grabowska A 1031 exchange is a tax-deferment strategy used by real estate investors to defer capital gains taxes when selling an investment property and purchasing a replacement property. However, some investors may wonder whether this strategy can Continue reading Can a 1031 Be Used for a Second Home?