How do you preserve a legacy? Not by incurring undue tax burdens, that’s for sure. If you’ve been thinking about selling your farm, ranch, or investment property and reinvesting the proceeds, you may have heard the term “1031 Exchange.” It’s a powerful tool in the world of real estate, and it doesn’t have to be complicated. In this post we go over how to sell with 1031 Exchanges and some things to consider beforehand.
Broker and CEO, Chip Bubela, recently dove into this topic on The Entre Podcast with guest Greg Lehrmann of Excel 1031 Exchange, who specializes in helping property owners navigate these transactions. Here’s a breakdown of why selling your property via 1031 may be the right option for your farm or ranch.
How to Sell With 1031 Exchange
What Is a 1031 Exchange (In Plain English)?
A 1031 Exchange is a strategy that allows you to sell a piece of income generating property and defer the capital gains taxes—as long as you reinvest the proceeds into another qualifying property. It’s named after Section 1031 of the Internal Revenue Code, but don’t let the legal name scare you off.
In simple terms:
Sell your farm, ranch, or investment property. Buy another (or 3). Pay no taxes (yet).
The best part is there are service providers that do all the hard work for you, and in some cases allowing you to turn your 1031 into mailbox money for years to come.
Who Can Benefit from a 1031 Exchange?
1031s are ideal for:
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Real estate investors looking to grow their portfolios
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Landowners or ranchers selling large tracts
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Business owners moving from one commercial space to another
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Even accidental landlords who now want to sell but aren’t ready to face a big tax bill
If you’re holding real estate for investment or business purposes (not as your personal residence), there’s a good chance you can benefit.
The 45-Day Rule (and Other Timing Deadlines)
One of the biggest things to know is the timeline. Once you sell your property:
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You have 45 days to identify potential replacement properties
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And 180 days to close on one of those properties
Missing those deadlines can disqualify your exchange—so it’s important to plan early and act quickly.
Don’t Stress About Legal Jargon
One common myth: you have to trade exactly the same kind of property (like raw land for raw land). Not true.
“Like-kind” simply means real property for real property—so you could exchange a rental house for a commercial building or a ranch for an apartment complex. It’s more flexible than most people think.
Want to Learn More?
Check out our latest episode of The Entre Podcast, where Greg Lehrmann breaks down 1031 Exchanges with real-world examples and expert advice.
Listen Now: Spotify | Apple | YouTube
Or contact us at Bubela Real Estate to see how a 1031 Exchange might fit into your investment strategy.
Bottom Line: A 1031 Exchange can be a smart way to defer taxes, grow your portfolio, and preserve your wealth – if you have the right team behind you. Let’s start that conversation.
Special thank you to Greg Lehrmann for teaching us more about how to sell with 1031 exchanges!
Follow him here.
