News

Welcome to our news page! We routinely post Section 1031- and real estate industry-related updates, tips, and experiences. Our goal is to support those seeking 1031 Exchange insight and provide unsurpassed service to every Exchanger we have the pleasure of working with. As a dedicated Qualified Intermediary for 1031 Exchanges, ERG/EquipEx is here to save you time, stress and ultimately to help you grow your wealth!

April 10, 2020

TIME EXTENSIONS FOR 1031 EXCHANGES ANNOUNCED UNDER IRS NOTICE 2020-23

Dear valued client/partner,

Amidst this challenging and unprecedented time, we are pleased to share some good news with you. On the afternoon of April 9, the IRS issued guidance (Notice 2020-23) providing time-constraint relief for Section 1031 Like-Kind Exchanges. Under this deadline extension language, it appears that any 45-day or 180-day deadline occurring between April 1 and July 14 will be extended to July 15, 2020.

Example 1: For a 1031 Exchange that began on April 1st, 2020, the 45-Day Identification Period Deadline would normally be May 16th. Under the Notice, this deadline is extended to July 15th, 2020. The Exchanger must still close on all replacement property by Day 180 of their Exchange (the Exchange Period Deadline), which is September 28th, because this date falls after the July 15th ending date of the disaster period.

Example 2: For a 1031 Exchange that began on December 15th, 2019, Day 45 was January 29th. This ID Period Deadline is not extended because it fell prior to April 1st. Although their 180-day Exchange Period Deadline falls on June 12th, the Exchanger receives an extension under the Notice to July 15th.

1031 Exchanges are designed to promote economic growth throughout the country and in our communities. Thankfully, the IRS has determined that investors utilizing this beneficial section of the Internal Revenue Code to make real property reinvestments while deferring tax liabilities should receive some consideration concerning the impact of the COVID-19 pandemic. As with other pandemic-related information, guidance here is not comprehensive and may not be final.

We will share new information as we receive it. Please know that we remain at your service, and wish you and yours all the best!

Sincerely,

Ken Palmen and the ERG Team

March 17, 2020

CARONAVIRUS CONSIDERATIONS

Dear valued client/partner,

We wish to address the current Coronavirus (COVID-19) situation and the actions we are taking. Our first priority is always the safety and health of our clients, partners and employees. ERG remains open for business and will continue to offer complete 1031 Exchange support and responsiveness through this challenging time. Our cloud-based infrastructure and ongoing investments in tools, technology and business continuity ensure that we can continue to deliver efficient service – when and where you need it.

As of today, the 45-day “Identification Period” and 180-day “Exchange Period” time frames relating to Section 1031 have not been extended, as this is authorized only by a Presidentially Declared Disaster (as opposed to the National State of Emergency declared by President Trump on March 13). If you are in the midst of a 1031 Exchange or plan to initiate one soon, note that these standard time frames currently apply. We will keep you apprised of any changes.

Clients/Investors/Exchangers:

• We understand that you may have questions and concerns about conducting your real estate evaluations and closings while minimizing your health risks, and we wish to provide appropriate information and guidance.

• If closing remotely, i.e. from your residence, is something you wish to consider, please contact your closer/escrow officer/title company to see if this is a service they offer, and at what cost. You may also want to ask about available options for notarizing documents as required (ERG does not require a notary for any 1031 Exchange documentation).

• Please contact your closer for information regarding the recording of deeds and finalizing of loans, if applicable. Some city and county government offices are currently closed, while others are working with reduced on-site staff, which may impact various aspects of your real estate transactions.

• ERG normally provides 1031 Exchange documents and instructions to each client and their closer via email, and we do not require original signatures in return. Rather, we ask the closer to include our documents with their other closing documents and to remit executed copies to us electronically.

Some of our team members may be assisting you remotely, but we are committed to providing service excellence without interruption. Please reach out with any questions or concerns and let us know how we can be of assistance. We wish you good health, strength and peace!

Sincerely,

Ken Palmen and the ERG Team

Federal Policy Update: Some Tax Extenders Expired as of 1-1-15

Section 168 “Bonus Depreciation” is again expired, while Section 179 “Depreciation Allowance” reverts to a $25k maximum allowance with a $200k investment cap. Congress will likely revisit these investment incentives again this year, with debate over broad scale tax reform continuing as well.

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Federal Policy Update: Tax Extenders Signed Into Law

This federal legislation, including reinstatement of Section 168 and expanded limits for Section 179, was approved by the Senate on Dec 17 and signed into law by the President on Dec 19. The measures are retroactive to Jan 1, 2014 and will expire on Dec 31, 2014.

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Federal Policy Update: Sections 168 and 179

Senate yet to vote on the Tax Extenders package, which includes reinstatement of Section 168 at a "50% bonus" level, and Section 179 to it's former, higher levels of $500k deduction/$2MM investment ceiling. Vote expected this week, then Obama's sign-off needed.

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Federal Policy Update: 168 and 179 reinstatement

Congress is expected to reinstate Section 168 and Section 179 this week. The measures will take effect retroactively to Jan 1, 2014 and cover 2014 only. 168: "Bonus Depreciation" or "Special Bonus Depreciation" allows taxpayers to depreciate an additional 50% of the...

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What is “Like-Kind”?

In a Section § 1031 Like-Kind Exchange, real property is generally like-kind to any other real property (i.e. vacant land may be exchanged for an apartment building and an office building for a strip mall). For personal property, like-kind is defined by one of two...

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Federal Policy Update

Congress is considering legislation to make Section 168 Bonus Depreciation and Section 179 Depreciation Allowance permanent. Insiders believe this matter will be shelved until after November 2014 elections. 168 is currently expired for 2014. Congress may reinstate it...

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1031 Exchanges for All (Types of Assets)

If it's an asset, you can exchange it via Section 1031 (well, it's nearly that broad). With very few exceptions including stock in trade, stocks, bonds, notes and certain ownership interests, any business-use or investment asset is eligible for a 1031 Exchange under...

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