BulldogTom Posted September 19, 2008 Report Share Posted September 19, 2008 Here is the situation. General partnership with farm land as the only asset. 3 equal partners. They are selling the farm land and then closing the partnership down. One partner wants to structure his portion as a 1031 exchange (sounds like I need Jainen). The others want to sell and take the profits. Can this partner do this? I am not touching this with a ten foot pole. It is way over my head, but I would like to know if it can be done, and if so, how? You may flog me in public now. Tom Lodi, CA Quote Link to comment Share on other sites More sharing options...
jainen Posted September 19, 2008 Report Share Posted September 19, 2008 >>I am not touching this with a ten foot pole<< You can beat this one with a short stick, Tom. The stick is called "partnership." Anytime you see that word, you don't have a 1031 exchange. Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted September 19, 2008 Author Report Share Posted September 19, 2008 Right - because he does not own the land, just an interest in the partnership. And partnership interests cannot be exchanged. BUT - Could the partnership distribute 1/3 of the property to him in liquidation and then he take his third and exchange it for other investment property? You can beat me with a bigger stick now. Tom Lodi, CA Quote Link to comment Share on other sites More sharing options...
jainen Posted September 19, 2008 Report Share Posted September 19, 2008 >>then he take his third and exchange it<< Sure--if he HOLDS it for business or investment use over a couple of years first. Or the partnership can (if they are very careful) do the exchange now and hold the replacement property for a couple of years, and then distribute it. But he can't use Section 1031 with a partnership interest, and he can't change ownership in the middle of an exchange. Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted September 19, 2008 Author Report Share Posted September 19, 2008 Thanks Jainen. You are bringing back memories from my partnership classes. I always hated those classes, because it was always about property transactions that were designed to avoid taxes. It is something I don't use very much, and I need some reminders about the rules. Someday I am going to grow up to be just like you!!!!! Tom Lodi, CA Quote Link to comment Share on other sites More sharing options...
jainen Posted September 19, 2008 Report Share Posted September 19, 2008 >>I am going to grow up to be just like you!!!!!<< You mean, old? I was born Sep. 20, 1948. Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted September 19, 2008 Author Report Share Posted September 19, 2008 >>I am going to grow up to be just like you!!!!!<< You mean, old? I was born Sep. 20, 1948. NO - I refuse to get old. I am just hoping to get smart. I have a ways to go. Tom Lodi, CA Quote Link to comment Share on other sites More sharing options...
zeke Posted September 19, 2008 Report Share Posted September 19, 2008 happy birthday (tomorrow)!!!!! Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted September 19, 2008 Author Report Share Posted September 19, 2008 That means tomorrow is the big 60. Only 5 years to retirement, provided your 401K did not have Fannie or Freddie or Lehman or AIG or Bear Stearns or WAMU or Indymac in it. Happy Birthday. Tom Lodi, CA Quote Link to comment Share on other sites More sharing options...
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