Many people ask “who is this Starker character and why are like-kind exchanges often called Starker 1031 exchanges?”
There was a lumber baron in Oregon who was named Starker who had this novel idea that 1031 exchanges did not have to be simultaneous horse swaps, where the taxpayer gave up his relinquished property and immediately and simultaneously received his new replacement property.
Changing the Paradigm
Instead, Starker had this idea: “hey I think I’ll give up my relinquished property in exchange for some replacement properties that I’ll receive some time in the future.”
In doing so, Starker created a new paradigm in the real of 1031 exchanges. The IRS challenged his exchange but the IRS lost on a procedural argument and Starker prevailed.
Starker opened up the door for this entire industry of delayed exchanges in which taxpayers give up relinquished property and later at some future date received their new replacement property. In 1991 the IRS constrained this process by issuing treasury regulations that limited The Exchange period Down to 180 days and further required taxpayers to identify the replacement property within the first 45 days. so it’s no longer the Wild West that Starker opened up for us back in the 1970s.
Work with a Qualified Intermediary on Your Next Starker Exchange
No matter what you call it – starker exchange, 1031 exchange, like-kind exchange, etc. – we can help you through the process. At CPEC1031, LLC, our qualified intermediaries have been helping taxpayers throughout the United States defer capital gains taxes on the sale of real estate. Contact our team of professionals today to learn more about how we can help with your next exchange. Our primary office is located in downtown Minneapolis.