Most folks considering a 1031 exchange don’t realize this one major income tax benefit left to real property owners all started here 40 years ago. In 1979 Portlander T.J. Starker changed the tax-deferred like-kind exchange industry forever when he sold timberland to Crown Zellerbach, Inc. in exchange for a contractual promise to acquire and transfer title to properties to be identified by him in the future.
Following litigation with the IRS regarding the deferral of income tax liability on this transaction, the Ninth Circuit Court ruled in his favor saying the Federal Tax Code does not require a simultaneous transaction and the modern 1031 exchange was born.
It should come as no surprise then that the Portland area generally and Lake Oswego specifically is rich in 1031 exchange talent. To site just two examples of exchange accommodators with a lifetime of professional expertise, the offices of Equity Advantage Inc. and Beutler Exchange Group, LLC are within two miles of one another.
Equity Advantage was founded by brothers David and Thomas Moore 28 years ago. Recognized experts in 1031 exchange, David and Tom started Equity Advantage in 1991 after successful careers in real estate investment and development.
As a local company committed to the Portland market, Equity Advantage quickly developed a reputation for partnering with their investment clients to develop unique strategies for 1031 exchange. In so doing, they have created an unblemished 28 year track of reducing their client’s tax risks and increasing the value of their real estate portfolios.
Furthermore, David Moore has done more than any other real estate professional to share this lifetime of knowledge with Portland area realtors, investors, attorneys and property owners through on-going seminars, classes and speaking engagements.
Equity Advantage is also on the cutting edge with regard to investment product development inside the 1031 space. David and Tom have tirelessly proselytized investors and real estate professionals regarding DST (Delaware Statutory Trust) properties and the increasingly large role they play with regard to replacement property selection inside 1031 exchange.
For years real estate investors have used Section 1031 of the Internal Revenue Code to exchange property for bigger and better ones. However, this almost always brings in its wake bigger management responsibilities and headaches.
The advent of DST properties 19 years ago in the replacement property mix changed this profoundly. As remotely managed, income producing properties, DST created the first truly passive option inside 1031 exchange for investors.
As real estate owners age, this passive, income producing vehicle has gained in popularity. Estimates now place the DST percentage of replacement properties selected at over 10%.
In helping introduce this product to the market locally and nationally, Equity Advantage has significantly increased the options available to all investors contemplating a 1031 exchange. As such, they have demonstrably increased the flexibility of an exchange and significantly increased the likelihood of its success for investors.
Following hard on the heels of Equity Advantage is Beutler Exchange Group, LLC. Founded in 2014, Toija Beutler brings 22 years’ experience as a real estate attorney structuring and documenting tax-deferred exchanges for clients and properties located in Oregon, Washington, Montana and around the nation.
Prior to starting Beutler Exchange Group, Toija managed the IPX (Investment Property Exchange Services) office located in downtown Portland. IPX is the nation’s largest 1031 Qualified Intermediary. IPX is a wholly owned subsidiary of FNF, the nation’s largest title insurance company through its title insurance underwriters – Fidelity National Title, Chicago Title, Commonwealth Land Title, Alamo Title and National Title of New York collectively. They issue more title insurance policies than any other title company in the United States.
For More Information In Lake Oswego
For more information on exchanges or investments, reach out to use at Peregrine Private Capital:
This material and views are prepared solely by the author and does not necessarily represent the views of the its affiliates. Statements concerning financial market trends are based on current market trend, which will fluctuate. Projections are inherently limited and should not be relied upon as an indicator of future results. Historical figures and performance are not indicative of future results. This is for informational purposes only and does not constitute an offer to buy or sell any investment.
DST 1031 properties are only available to accredited investors (typically have a $1 million net worth excluding primary residence or $200,000 income individually/$300,000 jointly of the last three years) and accredited entities only. There are risks associated with investing in Delaware Statutory Trust (DST) and real estate investment properties including, but not limited to, loss of entire principal, declining market value, tenant vacancies and illiquidity. Diversification does not guarantee profits or guarantee protection against losses. Potential cash flows/returns/appreciation are not guaranteed and could be lower than anticipated.
Because investors situations and objectives vary this information is not intended to indicate suitability for any particular investor. This information is not meant to be interpreted as tax or legal advice.