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Updated over 10 years ago on . Most recent reply
1031 exchange
Can you 1031 exchange a property owned by your LLC into two properties you own personally. example below
Steve & Matt are partners on a 4plex. They change title of there 4plex to their LLC
Than they 1031 exchange there 4 plex now under the LLC name to two rentals they own together under there personal names.
They would now have ownership of there two rentals homes as the LLC? Is this allowed I know a little complicated.
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#2 1031 Exchanges Contributor
- 1031 Exchange Qualified Intermediary
- San Diego, CA
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#2 1031 Exchanges Contributor
- 1031 Exchange Qualified Intermediary
- San Diego, CA
The contribution of the 4-plex into the two-member LLC has changed the ownership from two individuals as tenants-in-common into a multiple member LLC, which is generally treated as a partnership for income tax purposes. There are ways to work around this if you have sufficient time to do so, but if you 1031 Exchange out of the LLC (partnership) and into the two of your names as individuals (tenants-in-common), the 1031 Exchange will not qualify because the LLC and the two individuals are considered to be two different taxpayers for income tax purposes.