Episode Details

How to Master 1031 Exchanges for Hunting Land | 100% Wild Podcast Ep. 463

In the fourth and final podcast of our Cultivating Value series, Matt Drury and Tim Kjellsvik sit down with Joe Dierker, owner of First Harvest Land Exchange, to demystify the most powerful financial tool for landowners: the 1031 Exchange. While Episode One touched on financing, this episode dives deep into the high-stakes world of tax deferral strategies and building long-term wealth through real estate. Joe explains the "make or break" mechanics of using a Qualified Intermediary (QI) to avoid the "constructive receipt" of funds, which can instantly blow up your exchange and trigger a massive tax bill. Whether you are a first-time flipper or looking to secure a "forever farm" legacy, you will learn the critical differences between long-term capital gains, short-term marginal rates, and how the step-up in basis can benefit your heirs.

The conversation pulls back the curtain on the rigid timelines that govern these deals, including the 45-day identification window and the 180-day completion deadline. Joe reveals expert tips on the Three-Property Rule, why you must exchange for equal or greater value and equity, and how "mortgage boot" can lead to unexpected tax liabilities. We also tackle complex scenarios like reverse 1031 exchanges, carving out primary residences under Section 121, and navigating the "Ozarks Condo" trap. This series finale provides the ultimate masterclass in financial literacy for the modern hunter and land investor.

00:00:00 – Intro to the podcast

00:04:00 – What is a 1031 Exchange? Tax deferral vs. tax-free 

00:07:15 – Long-Term vs. Short-Term: Understanding capital gains brackets 

00:13:30 – The 12-Month Rule: Staying eligible for long-term treatment 

00:15:30 – Value vs. Equity: The "Pickup Truck" debt analogy 

00:18:55 – Mixed-Use Property: Carving out cabins and primary residences 

00:25:20 – Don't Blow It! The danger of constructive receipt of proceeds 

00:28:15 – The 45-Day Identification Window: Hard deadlines explained

00:30:50 – Identification Strategies: The Three-Property Rule vs. 200% Rule 

00:36:10 – The Legacy Play: Automatic step-up in basis for heirs

 00:52:15 – Reverse 1031 Exchanges: Buying before you sell

01:01:10 – Identifying without a contract: Risks and technicalities

 01:04:10 – Understanding "Mortgage Boot" and taxable cash-out

01:10:45 – Pop Quiz: Key tax distinctions in land purchasing

For more information on Buck Land Funding. Please contact Shawn Ryan (610) 909-9073 

https://www.firstbankers.com/bucklandfunding

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