Boot, in a real estate context, refers to any non-like-kind property that is included in a property exchange to balance the value. It can comprise cash, personal property, or other liabilities.
Carryover basis is the tax terminology used in tax-deferred exchanges to describe the transfer of the adjusted tax basis from a relinquished property to the newly acquired property. This concept is significant in deferring capital gains tax until the final sale of the property.
Deferred gain refers to the amount of gain that is realized but not recognized at the time of a transaction, commonly occurring in tax-deferred exchanges, often known as 1031 exchanges. Essentially, deferred gain allows taxpayers to defer paying taxes on capital gains by reinvesting the proceeds in like-kind properties.
Section 1031 of the Internal Revenue Code allows for tax-deferred exchanges of certain types of property, enabling the deferral of capital gains taxes under specific conditions.
A Tax-Deferred Exchange, often referred to as a 1031 exchange, allows investors to defer paying capital gains taxes on real estate investments when one property is sold and a similar one is purchased within specified time frames.
A Tax-Free Exchange, also known as a Tax-Deferred Exchange, is a real estate transaction that allows investors to defer capital gains taxes on the sale of an investment property by purchasing a similar property under IRS Section 1031.
