WHAT ARE THE GENERAL STATUTORY REQUIREMENTS FOR AN I.R.C. SECTION 1031 TAX-DEFERRED EXCHANGE SINCE THE FINAL REGULATIONS PUBLISHED IN JUNE OF 1991?
• Both the property surrendered and the property received must be held for productive use in a trade or business, or for investment; • The property surrendered and the property received must be of “like-kind”; • The exchange must be a reciprocal transfer of properties as distinguished from a sale and repurchase; There were other “rules” to come from the Final Regulations, such as Identification Period (45 days), Exchange Period (180 Days), form of Identification, Identification Rules, and the rule regarding the fact that you must acquire substantially what you have identified. There are other rules regarding restrictions on the funds on deposit from the exchange of the relinquished property. We will address these other rules as we proceed. Back to Top Glossary 21. WHAT IS BOOT? Not all property transferred in an exchange must be of like-kind. Other property or money can be transferred in addition, without invalidating the exchange. Such non like-kind property is called “boot”. In gener
