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Chicago Deferred Exchange Company

The Exchange

Tax Reform – A Call to Action to Save 1031

Dear Valued Clients –

With the Republican sweep of the November elections, the likelihood that major tax reform legislation will be introduced and passed in 2017 has become a near certainty.

The House Republicans introduced their Blueprint for tax reform - A Better Way – in June.

The Blueprint will allow taxpayers to immediately expense all capital asset acquisitions, including land improvements, but not land. As an offset to immediate expensing, taxpayers will no longer be able to deduct their net interest expense.

If the Blueprint becomes law, there is no guarantee that Section 1031 will be preserved. Farmers, ranchers and investors who own and develop land will not be able to expense their land purchases, nor will they be able to exchange their land as they can today.

Retaining Section 1031 is critical because the provision facilitates deal flow in real estate transactions and helps eliminate a “lock-in” effect that would otherwise occur absent 1031. Section 1031 also encourages capital formation, encourages development and property improvements, and stimulates economic activity.

If Section 1031 is important to you, please let your elected representatives know today that, as part of any tax reform legislation, Section 1031 should be retained.

The time is now, legislation is being drafted and will likely be introduced shortly after the new Congress convenes in January.

Please visit to send a letter today.

Thank you.

Mary Cunningham

President & CEO