The 'state of the art' in like-kind exchanges, 2006

Journal of Taxation

Volumn 104, Issue 3, 2006, Pages 138-165

  Lipton, Richard M ^a  

^a Chicago Office of the Law Firm   (United States)

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EID: 33645573206     PISSN: 00224863     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Review

References (18)

1. Lipton, "The 'State of the Art' in Like-Kind Exchanges," 91 JTAX 78 (August 1999);
2. Lipton, "The 'State of the Art' in Like-Kind Exchanges, Revisited," 98 JTAX 334 (June 2003).
3. H. Rep't No. 101-247, 101st Cong., 1st Sess. 1341 (1989); S. Rep't No. 101-56, 101st Cong., 1st Sess. 151-152 (1989).
4. Also see generally Cuff, "Teruya Brothers and Related-Party Exchanges - How Much More Do We Know Now?," 102 JTAX 220 (April 2005).
5. H. Rep't No. 101-247, supra note 2.
6. See Lipton, "IRS Bars Taxpayers From Building Replacement Property on Their Own Land - Or Does It?," 101 JTAX 222 (October 2004).
7. See Borden, Lederman, and Spear, "Build-to-Suit Ruling Breaks New Ground for Taxpayers Seeking Swap Treatment," 98 JTAX 22 (January 2003).
8. S. Rep't No. 98-169, Vol. 1, 98th Cong., 2d Sess. 243 (1984).
9. Rev. Rul. 89-121, 1989-2 CB 203, and Rev. Rul. 55-79, 1955-1 CB 370.
10. Rev. Rul. 79-143, 1979-1 CB 264, and Rev. Rul. 76-214, 1976-1 CB 218.
11. See Lipton, "New Rules Likely to Increase Use of Tenancy-in-Common Ownership in Like-Kind Exchanges," 96 JTAX 303 (May 2002).
12. See Lipton, Golub, and Cullen, "Delaware Statutory Trusts and 1031: A Marriage Made in Heaven or Just a Pipe Dream?," 101 JTAX 140 (September 2004).
13. The Ruling did not indicate whether John was related to Mary, but given that the IRS stated that Mary was not related to persons described in the Ruling other than John, it can be assumed that she may be related to him.
14. Although the lease from John to Mary is described in the Ruling as a "net" lease, it is not clear whether the lessor or the lessee would be required to make capital improvements or major repairs to the property. Thus, the lease might be "double net," in which the lessor remains liable for certain capital improvements and repairs (such as repairs to the roof), instead of a "triple net" lease in which the lessee is responsible for the property in all events.
15. Reg. 1.761-2(a)(2)(i).
16. A "credit tenant" is one which has issued "investment grade" debt instruments that have been rated by one of the major rating agencies.
17. Alternatively, some DSTs will provide that the trustees have the right to convert the DST into an LLC under state law, which should have the same tax effect, although a mere conversion might be viewed more skeptically by the IRS.
18. These Proposed Regulations will be the subject of a separate in-depth examination in an upcoming issue of THE JOURNAL.