Abracadabra! Sec. 1031 exchange can make capital gains tax disappear
Abstract: If a person owns a highly appreciated business or investment property that he or she would like to sell or otherwise dispose of, the person can possibly avoid capital gains tax by exchanging it for new property that he or she plans to hold (or continue exchanging) for life. A Section 1031 exchange allows a person to eliminate the tax — or at least defer it until he or she sells the new property. This article details how a Sec. 1031 exchange works and explains how it may fit into a person’s overall estate planning strategy.