$250 Million in Loss From 1031 Exchanges

In recent years, according to the Treasury, there have been 23 instances of major fraud involving $250 million in estimated losses with properties undergoing a “1031 exchange”. Unfortunately the land owners have been unaware of the fraud which sometimes forces exchangers to get hit with large tax bills from the IRS. 

Those responsible for 1031 exchange fraud are generally the intermediaries that the landowner hires to hold their money until they are ready to reinvest it into a like property.  Instead of holding the money and merely earning interest or some other form of payment on the money these intermediaries will “borrow” the money and not be able to pay it back or outright steal it and leave town. 

If you are thinking of hiring an intermediary to hold your money from a 1031 exchange check to ensure they are a reputable company.  One well-known intermediary is Orexco, a subsidiary of Old Republic. 

Thinking about doing a 1031 exchange or wondering what the benefits are?  Click here for more information!

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