721 Exchanges

Similar to a 1031 Exchange, the purpose of this tax strategy is the deferral of capital gains tax. If a 1031 Exchange is the exchanging for like-kind property, the 721 Exchange is a way for you to exchange your property for operating partnership units in a Real Estate Investment Trust (REIT). This strategy can be attractive for investors looking to diversity in a tax-efficient way and continue to potentially earn distributions on the operating income of the properties.