Does bitcoin qualify for a 1031 exchange?

In recent months, the idea that cryptocurrency such as Bitcoin might qualify for 1031 exchange treatment under tax law has been debatable. However, the new Tax Cuts and Jobs Act of 2017, passed in December, ends that discussion. Under this new law, trades of digital currencies do not qualify for 1031 “like-kind” exchanges.

Did SEC 1031 apply to bitcoin exchanges before TCJA?

On June 18, 2021, the IRS released IRS Legal Memorandum (ILM) 202124008, which addressed whether Sec. 1031 applied to certain exchanges of bitcoin, ether, and litecoin that occurred prior to the law known as the Tax Cuts and Jobs Act (TCJA), P.L. 115 - 97.

What is 1031 exchange connection?

1031 Exchange Connection is a Qualified Intermediary (QI). We help facilitate 1031 exchanges that allow our clients to defer capital gains taxes when purchasing like-kind real estate investment properties.