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Deeding Method to Use in 1031 Tax Deferred

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Deeding Method to Use in 1031 Tax Deferred Exchanges

In this article, I'd like to define two real estate terms—direct deeding and sequential deeding—and show the best form to use with 1031 Tax Deferred Exchanges.

If you're not familiar with the "1031," this law allows the exchange of investment or business property for other investment or business property, without paying tax (it's deferred) if the property received is "like kind."

As you'll see below, direct deeding is the better choice in this situation, but it's important to understand the difference between the two options so you're armed with full knowledge when you enter into a 1031 Exchange.

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