IRS to Examine 1031s
If you have used a Section 1031 tax-deferred exchange recently be sure to hold on to your documentation. The IRS is stepping-up their review of these types of transactions according to a Wall Street Journal report. The IRS has been urged by the Treasury in a recent report will be reviewing the 1031 rules and will be performing in-depth reviews of like-kind exchanges. Part of the reason is the the increase in tax-deferred exchanges doubling in 2004 to 338,500 from the 1998 figure. This represented almost $74B in deferred taxes.