Carman wishes to exchange 10 acres of Iowa farm land in a like-kind exchange. Which of the following properties will qualify for like-kind exchange treatment?

Question

Quizplus · Accepted Answer

A like-kind exchange, under Section 1031 of the Internal Revenue Code, allows for the exchange of real property used for business or investment purposes for another real property of like-kind. In this case, an office building (real property) is considered like-kind to farm land (also real property), whereas tractors and hogs are personal property, and a personal residence does not qualify for like-kind exchange treatment because it is not used for business or investment purposes.

Carman Wishes to Exchange 10 Acres of Iowa Farm Land