Boot refers to non-like-kind property or items acquired through an exchange. It can be created in various ways, such as receiving debt relief, cash, or incorporating personal property in your tax-deferred exchange. Any individual who would like their 1031 exchange to be free of taxes need to avoid boot. However, if they need money and don’t mind getting taxed, they can choose to receive boot.
1031 Exchange – Boot
Boot refers to non-like-kind property or items acquired through an exchange. It can be created in various ways, such as receiving debt relief, cash, or incorporating personal property in your tax-deferred exchange. Any individual who would like their 1031 exchange to be free of taxes need to avoid boot. However, if they need money and don’t mind getting taxed, they can choose to receive boot.
