1031 exchange from trust to LLC, will it work

[Andy Lanyi]

I want to set up for a 1031 of a set of apartments that are in a trust and put new apartments into an LLC. Will this work or do I have to keep the new property in the trust?

[Gino Barbaro]

@Andy Lanyi

I would contact @Dave Foster https://www.the1031investor.com/

I would also discuss it with the attorneys you set up the trust with

Gino

[Dave Foster]

Thanks for that shout out @Gino Barbaro.  @Andy Lanyi, It's going to depend on the nature of the trust and the desired LLC. If the trust is what is called a "disregarded entity" (meaning it does not have it's own TIN and does not file a tax return) then the activity of that property is reported on your personal tax return. You can sell that property as the trust and buy as yourself or as a "disregarded LLC"(an LLC that you are the only member of and that also does not file it's own tax return.

In a 1031 exchange, the taxpayer for the old property must be the tax payer for the new property.  When you are using disregarded entities like described above the property stays reported on your personal tax return.  Which is consistent and allowed in a 1031.  I'll reach out via pm to give you some more information