1031 Exchange vs Opportunity Funds

Opportunity Funds, the superior alternative

Sell your property and enjoy your principal tax-free

Saavy investors are familiar with 1031 exchanges. Less known is how Opportunity Funds provide similar tax benefits if you sell your property without any obligation to reinvest in a like-kind property (It is really difficult to find quality in 45 days). Here's how it works: If an investor sells their property, they can invest their gain in an Opportunity Fund to earn capital gain tax deferral and reduction and allow their investment in the fund to appreciate tax-free. Plus, their base principal is now free to invest or spend how they please! See below all the benefits of investing in an Opportunity Fund compared to performing endless difficult 1031 exchanges.


1031 Exchange

Opportunity Fund

1031 Exchange
Opportunity Fund
Principal
Requires you to rollover both the principal and the gain incurred
Only roll the capital gain gain into the fund - not the principal!
Fees
Involves a 3rd party intermediary who charges a fee
No fees to invest, no intermediary involved
Time Limit
180 Days
180 Days
Qualified Assets
Real Estate only
Capital Gains from any type of asset can qualify for investment
Investment Structure
Structured to allow for single asset swaps
Fund invests in multple properties across asset classes and USA
Diversification
Low
High
Tax Deferral
Capital Gains can be deferred indefinitely
Federal taxes on initial investment deferred until 2027
Tax Elimination
Deferred only
Gains on QOF is federal tax-free after 10+ years
Tax Reduction
Upon death
Basis step-ups of up to 10% in year 5
Hail Mary
Unattractive options within 180 days? IMMEDIATELY INVEST GAIN ONLY IN AAAMERICAN OZ FUND
CURRENT Federal taxes on CAPITAL GAINS DISCOUNTED AND deferred until SALE

Learn About Opportunity Funds

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