Is this possible?

[Phillip Wright]

I have a family business that is being sold, it consists of two funeral homes… we will be doing an asset sale sometime in the near future.

We would like to purchase a real estate portfolio with the money from the sale.

My question is:

If we sell the company as an asset sale, can we 1031 the real estate separate from the other aspects of the company? I have a portfolio of 13 doors that I could purchase and would like to 1031 into that portfolio. The portfolio would be roughly the same amount possibly less and the rest we would look for another property to purchase. So we’d certainly be purchasing something of equal or greater value. 

Thanks 

[Whitney Nash]

Hello @Phillip Wright

Yes, you can do a 1031 exchange with the portion of the sale that is attributable to the 'real property'. You will want to look at the valuation of the business entity itself vs. the value of the buildings, land, and any other 'real property' and work with your CPA to make sure that the amount that goes into the exchange is correct. You can then use the 1031 funds to buy the 13 door property and a second investment property if you want/need.