Recently, a client came to us with the following 1031 exchange situation. The client wanted to purchase a property solely in their name. Here’s where it gets complicated: the client wanted to divide the proceeds between two people after the sale. Is this possible to do this and still keep everything within the 1031 strike zone?
Determining How You’re Vested in Title
That is a very good question. Everything depends on how the client is vested in title on the old relinquished property. In order to figure that out we can pull a copy of the last vesting deed to confirm how they are currently in title.
For example, do they own the old relinquished property in a trust, an entity (such as a partnership), or do they hold title as tenants-in-common? Once we know how they hold title, then we can look at all of the available options for taking title to the new replacement property.
If you have additional questions about this or other 1031 exchange questions, contact a qualified intermediary today. At Commercial Partners Exchange Company, we have over two decades of experience facilitating exchanges of real estate. Contact us today at our downtown Minneapolis office for help with your next 1031 exchange!