1031 Exchanges: The Power Tool For Small Business Owners
The presidential election result looks sure to secure 1031 exchanges as an ongoing power tool for savvy small business owners.
Anti-tax break candidates Sanders and Clinton were feared to have followed Obama’s footsteps in working to cut back or eliminate the big tax benefits of 1031 like kind exchanges. According to the FEA (Federation of Exchange Accommodators) these like-kind exchanges are a vital tool for small businesses, and of course in turn the national economy and job market. Like Trump or not, it’s anticipated that he will preserve 1031s and perhaps even institute more income and real estate related tax breaks.
SME’s Can’t Ignore 1031s
1031 exchanges have long been regarded as one of the best tax saving tools for professional property investors. Vehicles like this are certainly used by large corporations as well. However, 1031s can be one of the most important tools for small business owners looking to survive and thrive too. In fact, it gives them a fairer playing field and edge.
A 1031 exchange can empower small business owners and entrepreneurs to scale up or diversify their locations without taking a big tax hit. That makes growth more feasible, and profitable. It allows them to expand to take advantage of market opportunities and the economies of scale, without having cash flow cramped or giving up valuable equity.
Real Estate 2020
They say hindsight is 20/20. Looking back we see many businesses who not only survived but thrived in tough financial times thanks to the strength of their real estate assets. Looking ahead, most predict we’ll enjoy a good four year run for real estate under the Trump administration, at least until 2020. This makes now the perfect time to leverage a 1031 and move up, especially while interest rates are low, and before property prices go up. A lot of corporate value and revenue, and security could come from these moves.
Utilizing these tax and investment tools doesn’t have to be limited to solely owner used property either. Look at Facebook and its forays into both corporate housing and affordable housing. Smart entrepreneurs and business owners could be advancing into multi-tenant properties, worker housing, and mixed use properties.
Consult and Strategize
If this sounds like an intelligent business and tax move for you or your business, get in touch today and consult a professional for customized advice and a plan for taking advantage of today’s opportunities, and the best moves for increasing future prosperity.