Paul A Thomas <taxman[at]negia.net> wrote:

- quote -

Offhand:

Will percentage of completion of construction on day 180
result in a value of the new property that equals or exceeds
that of the property being sold? Then it seems you have a
Starker exchange. Whereas construction after the 180 day
point is not received by the TP before the cutoff and
doesn't count.

Steve

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"Paul A Thomas" <taxman[at]negia.net> wrote:

- quote -

Paul, from Reg. § 1.1031(k)-1(e)(1): "1) In general. --A
transfer of relinquished property in a deferred exchange
will not fail to qualify for nonrecognition of gain or loss
under section 1031 merely because the replacement property
is not in existence or is being produced at the time the
property is identified as replacement property. For purposes
of this paragraph (e), the terms "produced" and "production"
have the same meanings as provided in section 263A(g)(1) and
the regulations thereunder." RBG

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Client asked if they did a 1031 exchange of residential
rental property and replaced it with what will be
residential rental (construction hasn't started yet), the
180 days to close limitation, would that include having the
property fully completed and move-in ready (ie: ready to
rent)?

The closing can happen well before the construction is
completed in this case (so they say).

My concern is that it may not be finished within the 180
days of the initial part of the 1031 exchange. And I don't
see anything on point where I've been looking.

Anyone have something that may help?

--
Paul A. Thomas, CPA
Athens, Georgia
taxman at negia.net

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >