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April 5-18, 2017 - Page 17 COLORADO R EAL ESTATE JOURNAL
Al t h o u g h
Donald Trump
has been President
fo r l e s s t h a n 50
d ays (as I write this),
cer tain things
about him and his
agenda are becom-
ing clear: he has a
very clear vision
about what he wants
to accomplish, and
he is very determined to
push his changes through.
Tax reform is high on his
agenda, and because he has a
Republican majority in both
the House and the Senate, it’s
likely there will be some form
of tax legislation proposed
later this year. Since I’m a
retired CPA and I make my
living in the Section 1031 tax
arena, I’m very con-
cerned about the pos-
sibility of changes to
this Code Section
and how these chang-
es would impact
my clients.
Let me start with a few gener-
al observations about tax leg-
islation: what’s proposed and
talked about in the beginning
seldom survives to become
law. The House Ways and
Means Committee will pro-
pose changes to be voted on
by the House. Likewise, the
Senate Finance Committee
will propose their own bill
that will be voted on by
the Senate. The House and
Senate bills then go to the
Joint Committee of Congress
that will combine these two
into one final bill that will
then go back to the House and
Senate to be ratified. After
ratification, the bill goes to the
President to be signed, after
which it becomes law.
This means lots of opportuni-
ties for additions, deletions and
tweaking along the way before
something becomes final.
Trump and the Republicans
have shown that they prefer to
work in the shadows until they
have a framework for a bill,
rather than drafting it with
media scrutiny.
Another general observa-
tion is that Congress strives to
make bills that are as revenue
neutral as possible. If they cut
taxes in one area, they then
raise taxes in another so that
the two balance out (at least as
close as they can make them).
This is the part that makes me
nervous about 1031 exchanges:
Trump has made it very clear
that he wants
to lower cor-
porate tax rates
– meaning that
he’ll have to find
new tax revenue
to replace that
lost through
lower taxes.
Section 1031
could be one of
the replacement
sources. This
means that to
replace revenue
lost through
lower corporate
taxes, Section
1031 could
be eliminated
either in whole
or in part. In other words,
you might have to pay tax
on the gain from the sale of
your rental so that Apple and
Microsoft can pay lower taxes
on their profits.
It appears unlikely that
Congress will hold hearings
on a tax bill until later this fall.
Since you’ve read all the way to
the end of this article, it means
that the future of Section 1031
is also important to you. So
please call your Congressional
Representatives and Senators,
and tell them that you are very
worried about the future of
Section 1031 and its impact on
you. One-to-one contact, like
a phone call, is much more
powerful than a written letter
or (worse still) a form letter.
Ask them to add your email to
their list to keep you informed
if Section 1031 does end up
being targeted for change or
elimination. And please feel
free to contact my office if we
can help you in any way.
...call your
Congressional
Representatives
and Senators: tell
them you are very
worried about the
future of Section
1031 and its
impact on you...
By Gary Gorman
founder, The
1031 Exchange
Expert’s; LLC
The FuTure oF 1031 exchanges
in a Trump congress
Gary Gorman is the
founder and owner of 1031
Exchange Experts’ LLC,
an independent national
qualified intermediary. A
retired CPA, Gary is the
author of the best-selling
1031 exchange book:
Exchanging Up!, and a
contributor to numerous
publications, including
Forbes, The Wall Street
Journal, Bloomberg’s and
The New York Times. He’s
also a contributing author
of books by Donald Trump
and Rich Dad/Poor Dad
author Robert Kiyosaki.
He can be reached at
or nationwide, toll free at
866-694-0204.
d u r a b i l i t y
Not a word you typically associate with a service
industry. It usually conjures images of trucks or
denim. But it should make you think of us, too.
We structured The 1031 Exchange Experts to
endure hard times so we can be here when YOU
need us!
We do it because we want your trust.
Call us!
We want to be your 1031 Qualified Intermediary.
N a t i o n w i d e , t o l l - f r e e :
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