1031 Exchange

[Ventucky Red]

OK... So I have this house located on the east coast, I'm on the west coast, that I have had a rental for some years... With this, the tenants that have been there for the past few years have approached my on possibly buying the house and to be frank, I have been thinking of selling it know as the market is turning around. I already understand the pitfalls of this and noted to them if I do descide to sell the price non nonnegotiable etc...

What I am thinking is converting the proceeds for the sale to a plane or two for rent/leaseback Would this qualify for a 1031 exchange or does this fall outside of the like property clause, and would I take a hit from the depreciation I realized?

Thanks

 

[Sam D]

House for a plane wouldn't work. Someone more qualified that me (Wayne...) can probably give a more complete answer.

 

[wabower]

You said all that needs to be said about the answer. Real property and personal property don't qualify as like-kind, and personal property exchanges are more restrictive than real property exchanges. Most of the text-books use an example like "rent houses and farm can be like-kind but cars and trucks can't."

House for a plane wouldn't work. Someone more qualified that me (Wayne...) can probably give a more complete answer.

 

[vintage cessna]

You're thinking of a "like kind" exchange, which this wouldn't be. However, if you purchase an airplane and place it in a business you can take a section 179 deduction, which for 2013 is , if I remember correctly, $125,000.