Question

Question 66 of 75. James, who lives in Texas, is searching for like-kind replacement property for his investment-use unimproved land Each of the following is qualified like-kind property EXCEPT: An office building located in California. 200 acres of farm land located in lowa. An apartment building located in Oklahoma. A 25-year lease of unimproved land in Texas. Mark for follow up

Answer 1

Answer:- A 25 year lease of unimproved land in Texas

Reason:- Under 1031 exchange rules, the ownership of like kind property should be acquired. Leases do not give ownership to the user. There is no requirement for the received property to be exactly what was exchanged. A real property should be exchanged for real property.