Don’t Let COVID-19 Affect Your Capital Gains! Invest In A 1031 Exchange


The coronavirus pandemic has completely disrupted regular life and businesses. Due to extended lockdown, the financial sector is continuously going downhill. Everybody’s worried about their health and safety, but nobody can undermine the importance of financial security.

Investors lost millions of dollars last month in stocks, shares, and bonds. The market is badly shaken, and every investor is hunting for stable options to improve their financial standing and recover their lost money.

1031 Exchanges seem to bring a little respite amid all the financial turmoil. It offers a smart option to defer capital gains tax and save millions. If you wish to get rid of any non-performing property, you can end up paying up to 35% of the sale amount towards payment of capital gains tax. You can avoid paying that hefty amount by investing the capital in a like-kind property of better grade and quality. As a matter of fact, the IRS allows you to defer paying capital gains tax, and that can help you save a lot.

You must’ve seen how the IRS showed leniency in approving 1031 Exchanges in the previous housing market crash as they are excellent for the real estate sector and also the economy. The only challenge is identifying a replacement property within a 45-day identification period after you sell your property.

Looking at the current scenario, which is bound to get worse, it is almost impossible to locate a suitable replacement property during this narrow identification period of 45 days. Investors are looking towards DSTs as the best option to overcome this hurdle.

DSTs are a great option as they let you buy a beneficial interest in a larger and higher-quality investment property than previously possible. These are prepackaged and can be closed as early as 3 days. All of that can be done digitally. So there’s no need to step out of the safety of your home.

Most farsighted investors in the United States are opting for 1031 Exchanges to defer capital gains tax. If you are in your identification period or looking to start a 1031 Exchange, down our free property list. You can also speak to our specialists who are working from home to assist you.

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