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What is a Tax-Deferred Exchange?

What is a Tax-Deferred Exchange?

A Tax-Deferred Exchange allows asset holders to swap one property for another without immediate tax liabilities. By reinvesting in similar assets, capital gains taxes can be postponed.

  • Defers Capital Gains Tax: Taxes apply only upon final sale.
  • Strict Timelines: Replacement assets must be identified within a set period.
  • Investment Growth: Funds continue compounding instead of being taxed.
  • IRS-Compliant: Certain rules must be followed for eligibility.

Tax-deferred exchanges optimize long-term wealth building by deferring payments while expanding investment portfolios.

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