1031 exchange transfer of property between LLC

Dear 1031x: Can we quitclaim a lot that we purchased thru a 1031x from one LLC to another LLC and retain 1031 status?  Both LLCs have the same members.  Can we sell or property that we purchased thru a 1031x before one year passes and do a new 1031x transaction without recognizing gain? Thanks for your help.

 

Dear C:  Generally speaking each LLC will have its own tax id #, file a separate tax  return and be treated as a separate taxpayer.  Therefore, you cannot simply transfer real estate from one to another without tax consequences. However, in the situation where ownership is identical you might be able to merge one LLC into the other without tax consequences.  Please check with your business tax advisor about this.  In answer to your second question, yes you can sell within one year and 1031 exchange forward with full deferral of income tax. Sincerely,

Steve Hickox
Attorney / President

infox@1031x.com