Transition Out of Active Real Estate Investment and Defer Federal & State Capital Gains Taxes
1031 exchanges help real estate investors transition to passive, institutionally-managed properties while deferring capital gains taxes.
Many real estate investors find themselves at a crossroads. After years of benefiting from the tax-efficient income that rental property can provide, the prospect of selling brings an uncomfortable reality: a substantial capital gains tax bill. 1031 exchanges allow you to maintain income, diversify, and defer capital gains, all without the burden of being a landlord.
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Why Investors Choose a 1031 Exchange
Work With Experienced Professionals To Determine if a 1031 Makes Sense For You
A 1031 exchange involves multiple coordinated elements, including:
✓ Determining whether a 1031 structure is appropriate based on timing and tax exposure
✓ Evaluating passive replacement structures such as Delaware Statutory Trusts (DSTs) or REIT-based programs
✓ Complying with the 45-day identification and 180-day completion requirements
✓ Engaging qualified intermediaries, tax professionals, and legal counsel
✓ Assessing how the exchange fits within broader estate and portfolio considerations
NEPWA works with seasoned third-party professionals that specialize in 1031 exchanges.
Another Path for Investors Ready to Step Back
For investors who have built substantial wealth through real estate, selling is less a transaction than a strategic inflection point with permanent tax consequences and no shortage of sub-optimal paths.
- Many investors face a difficult choice: sell business or investment real estate and pay substantial capital gains taxes, or continue managing properties indefinitely. Neither option may align with your goals.
- A properly structured 1031 exchange can defer those taxes while transitioning your investment to passive, institutionally-managed real estate, removing daily landlord obligations entirely.
- NEPWA provides access to experienced 1031 specialists who help coordinate qualified intermediaries, identify replacement property options, and navigate the strict 45-day identification window.
Start a discussion to explore whether this approach aligns with your financial situation.
Trust Indicators:
- SEC Registered Investment Advisor
- $5+ Billion* in Assets Under Management
- Serving High-Net-Worth Families for Over 21 Years
- Headquartered in Wellesley, MA — Serving New England and Beyond
*AUM as of 12/31/25
The 1031 Exchange Process
1. Pre-Sale Strategy Alignment
Before a property is listed, exchange parameters are established, including timing, tax considerations, and replacement property criteria.
2. Sale of Relinquished Property
The investment property is sold, and proceeds are transferred directly to a qualified intermediary to preserve 1031 eligibility.
3. 45-Day Identification Period
Within 45 days of closing, potential replacement properties are formally identified in accordance with IRS rules.
4. Replacement Property Acquisition
Identified assets, often including DST, UPREIT, or institutional structures, are evaluated, selected, and acquired.
5. Finalize the Exchange
The exchange is finalized within 180 days, with post-exchange planning addressing income, liquidity, and long-term strategy.
Start a discussion to explore whether this approach aligns with your financial situation.
About New England Private Wealth Advisors
New England Private Wealth Advisors, LLC is an SEC-registered investment advisor based in Wellesley, Massachusetts, serving high-net-worth individuals, families, and institutions throughout New England and beyond.
With over $5+ billion in assets under management (as of 12/31/25), NEPWA provides comprehensive wealth management services including investment management, financial planning, estate planning coordination, and specialized consulting services, including guidance for real estate investors overseeing complex, high-value real estate holdings.
Important Disclosures
New England Private Wealth Advisors, LLC (“NEPWA”) is an SEC-registered investment advisor. Registration of an investment adviser does not imply any specific level of skill or training.
NEPWA is neither a Certified Public Accounting firm or a law firm and does not provide tax or legal advice, respectively, to clients; such services are provided through select third parties unaffiliated with NEPWA. Please contact a tax or legal professional for advice in such matters. The success of any tax mitigation strategy is dependent on each client’s specific situation and results cannot be guaranteed.
Investing involves the risk of loss, including the risk of loss of the entire investment. Diversification does not ensure a profit or protect against a loss.
The 1031 exchange services referenced on this website are provided by an independent third-party service provider and not by NEPWA. NEPWA is not affiliated with the 1031 exchange provider and does not supervise or control the services provided. NEPWA receives compensation for referrals to the third-party provider. This compensation creates a conflict of interest, as NEPWA has a financial incentive to recommend the provider. Clients are not obligated to use the referred provider and are encouraged to independently evaluate and select any 1031 exchange service provider of their choosing. NEPWA does not guarantee the services, results, or outcomes provided by the third-party provider and assumes no responsibility for the accuracy, completeness, or performance of such services.