If you are looking to maximize your real-estate investing then you should consider utilizing the power of a 1031 exchange. The 1031 exchange is a process that allows you to defer capital gains tax on investment real-estate while reinvesting your money into new real-estate – A much better alternative to the painful process of simply selling your property and biting the bullet when it comes to capital gains tax. Originally, a 1031 exchange was designed to facilitate the movement of large tracts of agricultural land held by essential food growers who were land rich and cash poor. Today, the application of section 1031 is available to any real estate investor wishing to defer paying tax on profits and who is willing to continue investing.
A 1031, or like-kind exchange, gives you the freedom to reinvest your money without fear of capital gains tax and allows you to reinvest your tax dollars for your benefit. This is a powerful tool for any real estate investor looking to shape their portfolio and take their real-estate investing to new heights.