Q: What is the difference between a sale and an exchange?
A: A sale is an exchange of real or personal property for cash. Cash does not meet the requirement for "like-kind" property, so the capital gain is not deferred. An exchange of property traded for like-class property is "like-kind" and therefore a "non-taxable" sale.
Q: What provisions are required in a Purchase and Sale Agreement to enter into an exchange?
A: A Purchase and Sale Agreement, should contain language which establishes the exchangor's intent and notifies the buyer of the exchange.
Q: Can an investor trade from several assets, like several properties into one property?
A: Yes. An exchangor can also trade out of one large asset into several smaller ones. When selecting more than one replacement,personal property exchangor's must adhere to the Treasury guideline regarding property identification.
Q: How are the exchange funds protected?
A: Starker Services, Inc.has a variety of security devices including semi-fettered accounts, letters of credit, Treasury-backed and individual accounts.
Q: Can an investor take some of the cash and exchange the remainder?
A: Yes. Any cash received may be subject to capital gains tax. There are strict guidelines for receiving cash; however, if structured properly, partial deferment can be accomplished.
The true power of exchanging is the ability to meet investment objective without losing equity to taxation.
- NUMBER1EXPERT™ 
