Internal Revenue Code Section 1031 enables Investors to defer capital gain taxes from the sale of an investment property. By utilizing a 1031, tax-deferred exchange, proceeds from the sale are invested into a “like-kind” property or properties.
1031 Exchange GuideLike-kind properties include a variety of real property types, such as apartment buildings, office buildings, and retail properties. Sub-surface real estate, meaning deeded mineral rights and royalties, also qualify as like-kind, a fact not widely understood in the real estate community.
Because minerals and their associated royalties are classified as real property, they are, in fact, like-kind and eligible for 1031 exchanges. Resource Royalty provides sophisticated, accredited investors the opportunity to invest in this lesser-known, like-kind property, expanding their portfolio beyond traditional brick-and-mortar real estate.
