businessman showing liquidity of real estate sales and profit

Maximizing Profits and Deferring Taxes: Understanding the 1031 Exchange in Real Estate

Real estate investors constantly seek opportunities to maximize profits and optimize their portfolios. One strategy that has gained considerable popularity in the real estate investment world is the 1031 exchange. This provision, named after Section 1031 of the Internal Revenue Code, allows investors to defer capital gains taxes by reinvesting the proceeds from the sale of one property into the purchase of another “like-kind” property.