business asset exchanges
DUE TO THE NEW TAX BILL ESTABLISHED IN 2018, EXCHANGES OF BUSINESS ASSETS ARE NO LONGER ALLOWABLE. REAL ESTATE IS THE ONLY ASSET A TAXPAYER MAY EXCHANGE. We will leave this page open and active "just in case."
Business assets other than real property often can qualify for tax deferral through the use of a 1031 exchange. Some examples of such assets include technology equipment, business airplanes and vehicles, construction and manufacturing equipment. Essentially, any depreciable asset with a reasonable residual value at the time you wish to dispose of it is a candidate for a like-kind exchange.
The like-kind requirements for business asset exchanges are more stringent than those of real estate. In real estate, virtually all real estate is like-kind to all other real estate with minimal exceptions. When it comes to business assets and personal property, assets must be matched within asset classes or product classes as defined by the Internal Revenue Service. Property may be exchanged only for other property that falls within the same asset class or product class. We will be happy to discuss your objectives and help you determine like-kind status of the assets you are considering.
A tax-deferred exchange provides the possibility of netting more usable cash towards the new asset by selling assets outright and upgrading equipment without the necessity of trading it in to the dealer and taking less for it. More cash, more flexibility--what's not to like?