If you are planning to perform a 1031 exchange, there are important things to consider. One of the biggest decisions is selecting the right advisor to guide you through the process. A successful 1031 exchange advisor can provide the necessary advice to help you save money and gain important tax benefits. However, with so many advisors out there, it can be challenging to find the right fit. In this article, we are going to provide tips on how to select a 1031 exchange advisor.
Look for Experience and Credentials – When choosing a 1031 exchange advisor, look for someone with significant experience in the field. Your advisor should be well-versed in tax law and various types of 1031 transactions. They should also have experience working with various types of properties, like commercial real estate, agricultural land, and residential properties. Additionally, look for an advisor with credentials such as the Certified Exchange Specialist (CES) or Certified Commercial Investment Member (CCIM) designation.
Ask for Referrals – One of the best ways to find a trustworthy and reliable 1031 exchange advisor is through referrals. Ask friends, family, or business associates who have experience with a 1031 exchange program for recommendations. You can also reach out to a qualified intermediary, who can provide you with a list of advisors they work with regularly.
Evaluate Their Communication Skills – The key to a successful 1031 exchange is clear communication. You will need an advisor who can explain the process in layman’s terms and answer all of your questions promptly. When interviewing potential advisors, pay close attention to their ability to communicate with you. If they are hard to reach or don’t return your calls promptly, it may be a red flag.
Compare Pricing Options – The cost of a 1031 exchange advisor can vary depending on their experience and services provided. Ensure that you compare pricing options from various advisors before making a decision. However, keep in mind that the cheapest option may not always be the best choice. Look for an advisor who offers a fair price for their services, and does not charge hidden fees.
Check Their Availability – In addition to experience and communication, it’s important to consider the time investment required from your advisor. Make sure that your advisor has the availability and willingness to work with you throughout the 1031 exchange process. Ask them how many clients they are currently working with, and if they can commit the necessary time and resources to your transaction.
Conclusion:
Performing a 1031 exchange can be a complex and time-consuming process. To ensure that your exchange is successful, it’s essential to select the right advisor. By following the tips outlined in this article, you should be able to select an advisor who is experienced, communicates effectively, and offers a fair price for their services. Don’t rush the selection process, and take the time to interview multiple advisors to find the best fit for your needs. With a trusted advisor on your side, you can successfully navigate the 1031 exchange process and reap the benefits of this valuable tax strategy.