What is the statutory basis for Sec. 1031 exchanges?
Generally, Section 1001 (c) of the Internal Revenue Code of 1986, as amended (the “Code”) provides that a taxpayer must recognize gain or loss on the “sale or exchange” of property. As a result, the taxpayer is subject to capital gains tax on any realized gain arising out of the sale of real estate held by the taxpayer for business or investment purposes. However, §1031 of the Code represents one of the last legitimate tax shelters available to owners of real estate; §1031 provides a vehicle to allow real estate owners to defer payment of capital gains tax by reinvesting sales proceeds derived from the sale of property to a third party (the “relinquished property”) in the purchase of similar real estate (the “replacement property”).
Related Questions
- There are several trial accesses available as on now. Please clarify whether ACM Digital Library & J-Gate will be available on regular basis or only just for few months?
- Is NIOSHs evaluation of an SEC petition dependent on the status of a Site Profile or Technical Basis Document?
- What are the statutory basis for foreign investment in India?
