A 1031 exchange is a tax-deferral tool that real estate investors can use to build wealth, save on taxes, and expand their portfolio. This strategy is applicable to any investor who wants to sell an existing property, and trade up for higher cash flow.
In this post, we’re sharing five major benefits of a 1031 exchange! If you’ve ever wondered if a 1031 exchange is right for you,
Tax Benefits. By rolling one asset into another, you can defer the capital gains taxes on the sale of your rental property. This has the potential to save you thousands of dollars in taxes.
Portfolio Growth and Diversification. A 1031 often allows an investor to take one high value property, and buy multiple properties with higher returns.
Upgrading Undesirable Assets. This strategy is a fantastic way for investors to transfer out of overpriced, underperforming rental properties.
Long-Game Strategy. A 1031 exchange can be repeated over and over again, deferring taxes indefinitely.
Build Legacy Wealth. Upon your death, your heirs will inherit all of your assets tax-free!