Understanding Reinvestment Requirements

1031 exchanges allow for tax deferral on property sales if fully invested. The replacement property must be equal to or greater in value than the net sale price, which is calculated by deducting selling expenses from the gross sales price. The net purchase price of the replacement property is calculated by adding expenses to the purchase price. 100% of the net cash proceeds must be reinvested, and any new debt on the replacement property is the difference between the total purchase price and net cash proceeds. It’s important to note that lower purchase prices or taking out cash equity may result in tax liabilities. 1031 exchanges are complex and require expert assistance, so it’s recommended to contact Coldwell Banker, Commercial Capital Advisors for help.

For the past 40+ years it has been our honor and pleasure to help clients achieve their investment goals through commercial real estate investing through…

  • Our Exclusive Nationwide Investment Network
  • Off-Market Commercial Real Estate Opportunities – Nationwide
  • and Saving Taxes with 1031 Exchanges

To Learn More, Give CBC Capital Advisors a Call at (806) 793-0888

In addition, you can learn all about our exclusive nationwide investing network and capabilities by watching Rick Canup’s short investment presentation below.