The Edmund & Wheeler, Inc. team hopes that you have had a tremendous 2017. We have been incredibly busy this year with many very interesting engagements.
We are paying close attention to how the proposed tax reform bill will effect our personal and business lives. For the past couple of years we have been hearing rumors of Section 1031 being repealed or severely altered. This, of course, is quite troublesome to our firm, who has provided exchange services for over 35 years. It’s our mission in life!
The current bill being “negotiated” on the hill redefines like-kind exchanges. The proposal includes language that would amend code Section 1031 from exchanges of like-kind property, to exchanges of like-kind real property. This ensures real estate investors maintain the benefit of deferring capital gains realized on the sale of property.
It is not such good news for many of our clients that have taken advantage of Section 1031 for the exchange of their assets that are classified as personal property. This includes everything from the sale of furnishings of a hotel to heavy equipment and musical instruments.
During the past few years Edmund & Wheeler, Inc. has joined with the Federation of Exchange Accommodators (FEA) and other Exchange professionals around the country to ensure that the lawmakers are well informed and educated on just how Section 1031 positively effects the commercial real estate market, and the economy in general. I think this effort has been very successful in that many lawmakers were pushing for the total repeal of Section 1031.
Today is November 12th, and we are still not out of the woods yet. The fear now is that 1031 will become a “bargaining chip” during the course of the next couple of weeks.
It is not too late to have your voice heard in Washington D.C. If you are so inclined, let your representatives know that Section 1031 must survive.