Structuring 1031 Like-Kind Exchanges After IRS Victory In North Central Leasing
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Developments in 2015 concerning Section 1031 like-kind exchanges and its tax deferral benefits demonstrate that counsel and tax advisors must be fully up to speed on the requirements of a 1031 transaction.
The Administration’s 2015 budget release proposes to limit real estate like-kind exchanges to a $1 million annual deferral cap. This may lead to a surge in like-kind exchanges, as business owners move to realign their business asset holdings before changes take effect. Additionally, the use of entities such as Delaware Statutory Trusts presents compliance issues that counsel and tax advisors must prepare to navigate.
Failure to observe the 1031 rules will lead to a like-kind exchange becoming a taxable event, as the defendant learned in the Eighth Circuit’s Mar. 2, 2015, holding in North Central Leasing L.L.C. v. United States. The court upheld the district court’s ruling for the IRS, which denied 1031 deferral treatment to nearly 400 like-kind exchanges by the taxpayer between 2004 and 2007.
Counsel must correctly structure 1031 exchanges according to IRS requirements or face unraveling exchanges, amending tax returns, and an unexpected tax hit for clients. From defining the role of the qualified intermediary in complex structures such as forward or reverse exchanges, to navigating related-party rules, there are a number of pitfalls for the unprepared advisor.
Listen as our experienced panel reviews and offers their insights into recent 1031 developments. The panel will provide attendees with best practices to avoid unwanted tax consequences from a failed 1031 exchange.
- Framework of 1031 exchanges
- Eligible assets
- Timing requirements and use of qualified intermediary
- “Boot,” debt, basis and gain calculations
- Reverse exchanges
- Forward exchanges
- Entities, land trusts and DSSTs
- Section 1031(f) related-party rules after North Central Rental and Leasing
The panel will review these and other key issues:
- What types of exchanged properties are more likely to be considered sufficiently “like-kind” and receive tax deferral?
- What is the role, and restrictions, of the qualified intermediary?
- How to avoid the 1031(f) restrictions against related-party exchanges?
- What are the requirements of Sec. 1031’s “holding period requirement”?
After completing this course, you will be able to draft a qualifying like-kind exchange eligible for tax-deferral. You will know the rules for selecting property eligible for 1031 deferral treatment, and the timing requirements for identifying exchange property. You will know how to identify “boot” and other current taxable items, and you will be able to calculate basis on the exchanged property received. You will understand the structures of complex transactions, such as reverse exchanges and forward exchanges, and how qualified intermediaries fit in the framework of such complex exhanges. And, you will have detailed knowledge of how to navigate the 1031(f) rules for exchanges among related parties.
Continuing Education Credits Available
This program has been approved for 2.0 CPE hours through Strafford Publications. CPE Credit is available only for the LIVE webcast. Recorded versions do not qualify for credit.
Strafford is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit.
To obtain CPE credit, attendees must participate in the live event, return an Official Record of Attendance to Strafford affirming their participation (including the CPE code announced during the program), and pay a processing fee of $35 per person.
Strafford will mail a certificate of credit within approximately 2 weeks of receiving an attendee's completed Official Record of Attendance—provided all required conditions have been satisfied.
Handout materials and the phone number for live presentations are made available to you 1 day prior to the event via email from the presenter. Copies of the presentations are included with recorded versions.
If you order a recorded version of the webinar, CDs will be mailed out approximately 10 days after the live event. Shipping is included in the price of recorded versions.
Joseph C. Mandarino, Atty
Cohen Pollock Merlin & Small, Atlanta
Mr. Mandarino's practice focuses on corporate, tax and finance law. He is involved with a wide variety of businesses and transactions, including experience with like-kind exchanges and structuring M&A transactions.
Renato Matos, Partner
Capell Barnett Matalon & Schoenfeld, Jericho, N.Y.
Mr. Matos' practice concentrates on corporate, taxation and real estate law, including stock purchases/sales, asset purchases/sales, mergers and acquisitions, corporate governance and entity formation, with a particular focus on tax structuring and strategic business planning.
Ricky Novak, CEO
Strategic 1031 Exchange Advisors, Atlanta
Mr. Novak's firm provides real estate and tax consulting services for clients structuring complex real estate transactions and asset dispositions. He specializes in the facilitation of tax-deferred like-kind exchanges under IRC Section 1031, and has assisted clients in structuring reverse exchanges, construction exchanges, non-safe harbor exchanges, multi-asset business sales, and international exchanges.
Cannot Attend The Live Presentation?
This presentation is also available in a recorded format, in On-Demand Or CD versions, as shown in the pricing options below.
|About Webcasts / Audio Conferences / Podcasts:|
Webcasts, audio conferences, and podcasts are presentations that you
attend via the Internet, phone, or mobile device at a specified date and time for "live" versions, or at your convenience for "recorded" and "On-Demand" versions.
versions are interactive, meaning that participants can ask questions in real time, plus are a very cost-effective form of training because 1) you receive fast, convenient learning without
any out-of-office time; 2) you can invite as many colleagues as you'd like to listen in on a single phone line; 3) you incur no travel expenses; and 4) you and your colleagues are back
at work immediately after the session ends!
And though with recorded versions you do lose the ability to ask questions, you gain the ability to hear the presentation numerous
times and to share it with others in your office.
Handout materials and the phone number for live presentations are made available to you prior to the event via email from the
presenter and from the "MyAccount" link on the menu bar. Copies of the presentations are included with recorded versions.
|Licenses / Designations / Educational Credits:||CPE|
All US States: 2
All US States: 1.5
|About The Provider:
||Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be addressed to the National Registry of CPE Sponsors, 150 Fourth Avenue North, Suite 700, Nashville, TN, 37219-2417 or by visiting their website.
Strafford webinars and teleconferences offer an excellent opportunity to train your entire staff—with no lost travel time or expenses. They are extremely cost-effective—allowing an unlimited number of people at your location to listen from a single line at no additional charge.
Each live seminar features presentations by a panel of nationally recognized authorities, followed by an interactive Q&A session. Presentation materials can be viewed online or printed out. Audio can be accessed via the web or a telephone.
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