At the request of membership, the IPA has formed a “1031 Working Group”. The objective of the group is to preserve the 1031 LKE industry from current tax reform proposals and present the economic benefits of this long-standing investment by bringing together all 1031 stakeholders.
IPA Members met on June 3 for a 1031 Advocacy Workshop to discuss specific policy positions, action plans, identify gaps in data, and other resources required to support our advocacy efforts. All 1031 stakeholders, sponsors, broker-dealers, RIAs, brokers, and all industry partners are encouraged to attend. If you are concerned about preserving 1031, please lend your voice now to this important workshop.
Tax Reform Threatens 1031 Industry
President Biden’s $1.8 trillion American Families Plan would make $1 trillion in new investments and provide $800 billion in tax cuts over 10 years. The President proposes to pay for this plan with tax increases, which includes, among other things:
- Raising the tax rate on capital gains and dividends to 39.6 percent for households making over $1 million
- Repealing the deferral of gain for real estate like-kind exchanges for gains greater than $500,000
- Eliminating stepped-up basis for gains in excess of $1 million ($2.5 million per couple “when combined with existing real estate exemptions”) and taxing the gains if the property is not donated to charity.
*According to the plan, the reform will be designed “with protections so that family-owned businesses and farms will not have to pay taxes when given to heirs who continue to run the business.”
Prior to and since the President’s announcement the IPA and coalition partners have made great progress articulating compelling messaging around our industry. As we navigate this uncertain political landscape, we need immediate insight, direction and participation from our members.
To save section 1031, member thought leadership is imperative.