How Deferring Capital Gains Can Support a More Purposeful Investment Life
By Tom Warburton
Selling appreciated real estate comes with a price, namely, capital gains tax. For investors who want to keep their equity compounding rather than shrink it with taxes, the IRS offers a lesser-known but highly effective strategy: the 1031 Exchange.
This Purposeful Insight explores the potential value of the 1031 Exchange, a provision in the Internal Revenue Code that allows for the deferral of capital gains taxes when proceeds from the sale of one investment property are reinvested into another qualifying “like-kind” property. While the rules are precise and the timelines strict, the benefits can be meaningful when managed with discipline and foresight.
At Warburton Capital, we believe in purposeful wealth management. A 1031 Exchange is not a tax loophole. It is a structured planning tool, one that can help preserve capital, reallocate into more suitable properties, enhance potential income, and support long-term estate planning. When applied with thoughtful coordination, it can align both with an investor’s immediate needs and their multi-generational goals.
