Larry J. Brant, a shareholder in the tax and benefits group of law firm Garvey Schubert Barer, discussed tax reform and the possibility of IRC § 1031 being repealed with Law360 reporter, Natalie Rodriguez.
Real estate developers are closely watching the 1031 Exchange debate. According to Brant, federal lawmakers won’t be tackling this issue anytime soon, but that doesn’t mean the battle is over.
“I doubt we're going to have real significant tax reform this year with so many things going on in Washington," Brant said. "If we do have tax reform, my best guess is it will deal with other issues, primarily international issues … but I think it's clear that Section 1031 is being looked at because of the tax revenue it would generate by being repealed."
“I've heard from clients that have regularly been involved in doing exchanges, and these are mostly real estate exchanges, that they are concerned. In one case, it prompted the taxpayer to do an exchange this year in the fear that if he put it off until a future year, he may not be able to do it."
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