Section 1031 of the Internal Revenue Code (Code or IRC) is a significant tax planning tool. It provides an exception to the rule that gain must be recognized on the sale or exchange of real property when certain qualifying property is exchanged for other qualifying property that is like kind.

Under Section 1031 of the IRC, no gain or loss is recognized on the exchange of property held for productive use in a trade or business if that property is exchanged solely for property of like kind that is held for productive use in a trade or business or for investment.

The property owner will not realize gain on the exchange, but may realize gain later when the replacement property is ultimately sold or otherwise disposed of in a taxable transaction.

This Toolkit contains continuously maintained Practice Notes, Standard Documents, Standard Clauses, Checklists, and Presentation Materials to help counsel for property owners, lenders, and investors understand, negotiate, and close a 1031 like-kind exchange of real property.