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| I have a small 25 acre farm located 10 miles away from my home farm. A couple of farms less than a mile or two from my home may be coming up for sale in the near future. I am not really a land buyer at today's prices. It is my personal belief that land may continue to trend downward for a while. Although, I think this could be an opportunity to consolidate or exchange land that is further away from home to become more efficient.
I've researched 1031 exchanges and the process sounds somewhat complex. Maybe I am wrong but I wouldn't feel comfortable doing a 1031 unless I knew the owner of the new land I was purchasing really well and also the buyer of the relinquished property. Correct me if I am wrong but is the 1031 process as complicated as it sounds like it to be? It seems that the cost of a 1031 is exchange regardless of the farm size. It may not be practical for such a small farm like this.
Has anyone ever traded farmland with a neighbor to avoid capital gains/income from depreciated tile. How did it work? I'm located in north central iowa.
Thanks, | |
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TRADING FARMLAND
