First you must have a qualified 1031 intermediary. To this day, I find it shocking that people call me up in escrow telling me that have 1031 money getting ready to close escrow and they do not have an exchanger. I'm like you are so screwed in five, four, three. The money must never touch your hands!

Best 1031 Exchange faciliators I've ever worked with - it's a husband and wife team and they are on the ball. Their turn-around time is incredibly fast - you're going to want to keep their contact information for your 1031 exchanges! Good luck!

John & Sarah Starling

National Realty Exchange Services

105 Hallbrook Farms Cir.

Wilmington, NC 28411

910-233-5050

john@nrx1031.com

That's a conversation the RE investor needs to have with their CPA. 

I have no idea... this is a question to be covered between a CPA and his/her client with the assistance of a tax/real estate attorney.

Each investor's needs and situation is different so they need to consult their team of experts...CPA, RE attorney, tax attorney, etc. for professional advice.

They can save on the Real Estate Sales Tax by doing a 1031 but they have to follow the rules for the sale & purchase. An Attorney qualified in 1031 transactions could be of assistance. 

By carefully assesssing opprtunities and seeking the advice of an expert third party exchange agent along with advice from their CPA and attorney. With that team in place they can defer taxes and continue to build equity. At some point the tax bill becomes due!

Frankly, in my 16 years of real estate I still have yet to work with a RE investor. I think in our area they prefer to go through an RET or an attorney Andrew Cooper .

If your instructor tells you to ask a question about 1031 exchanges for your license exam, you need to find a better school.  I doubt any questions for your license will have anything to do with 1031 exchanges.

It is an investor tax deferrment strategy and best to discuss with your CPA and a 1031 Exchange specialist to be sure you are staying within all required quidelines and deadlines.  

Important to do these correctly, get competent representation.

You should take a separate class on this 

there's only one proper and safe way to take advantage of a 1031 exchange and that's by first hiring a real estate attorney.... 

This is a tax strategy, and it better to ask a CPA or a Tax Attorney.  They are strict rules to follow, and it has an intermediary who handles the transaction.  A

A 1031 exchange (aka 'like kind' exchange) is a tax management tool. Deferring, delaying or avoiding taxes is not a bad idea. How this applies to the benefit of an individual investor really depends on their situation.

An account or attorney my suggest a self-directed IRA or self-directed ROTH IRA and LLC as a more beneficial option.

It is all about tax management.

Andrew, somehow I think you are missing the point of your instructor's assignments. AR should not be used for Q's that have legal, factual answers; those should be researched or sought from proper experts in the field. 

Carefully follow tht IRS guidelines.

It depends on the specific transaction.

We have companies that specialize in being mediaries for 1031 exchanges. They and tax professionals are the best source for the answer to your question. There are specific rules to be observed to achieve the purpose of a 1031 exchange.

Tax-Free is the way to be!

Sell one and use the proceeds to buy more than one property.  Or invest in other approved areas.

I've helped many clients with 1031 exchanges and always use a qualified intermediary. Tax laws are what they are ... they need to be followed or there are consequences.

I wish you all the best with your studies. 

By following the rules.

Defer the payment of capital gains tax.  

Just Google "1031 exchange" and hundreds of sites will come up, most containing detailed explanations of what it is and how it works and benefits to investors

Then tell your instructor you obtained the information on the Active Rain Q&A Section.

Good luck.

Start by contianing a good com pany that does these..

Have done a few, and a good program for investors.  Follow the rules.

Take a class at your title company on it.