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Wallstreet Esq.
Wallstreet Esq., Tax Attorney
Category: Tax
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Experience:  10 years experience
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I have a piece of equipment to sell. If I trade it different

Customer Question

I have a piece of equipment to sell. If I trade it for a different piece of equipment, what are the tax implications. The equipment I have has been written off for years.
Submitted: 1 year ago.
Category: Tax
Customer: replied 1 year ago.
The equipment is a specialty vehicle. We no longer have that business, but we do have a trust with rental properties. We're thinking of trading this equipment for a tractor needed for the rental properties.
Expert:  Lev replied 1 year ago.
If you trade the business equipment for a different piece of equipment - that will be classified as if your original equipment is sold at its fair market value.You MAY however - instead of recognizing the gain on that sale - use section 1031 exchange - assuming both are like-kind assets. In this case - the gain will be deferred until the replacement property woudl be sold or otherwise disposed.

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