<div dir="ltr">Thanks. So, under 1031, even though my client could not have purchased through a family LLC, it is still okay to put his interest into a family LLC soon after closing? I just wanted to make sure that I avoid any step transaction type argument by the IRS. Would appreciate your thoughts on this.<div><br></div><div>Thanks,<br><div><br><div class="gmail_extra"><br><div class="gmail_quote">On Sun, Feb 7, 2016 at 4:51 PM, John J. Sullivan <span dir="ltr"><<a href="mailto:sullaw@comcast.net" target="_blank">sullaw@comcast.net</a>></span> wrote:<br><blockquote class="gmail_quote" style="margin:0 0 0 .8ex;border-left:1px #ccc solid;padding-left:1ex"><div dir="auto"><div>The RLT is a disregarded entity, so it doesn't matter if he or the RLT take title to the substitute property. </div><div><br></div><div>Not so the family LLC. I would make sure the two steps are separate transactions. Maybe wait a months before contributing the new property to the LLC. All should do it at once so Sec. 721 treatment is clear. </div><div><br></div><div>John Sullivan<br><br>Sent from my iPhone</div><div><div class="h5"><div><br>On Feb 7, 2016, at 4:38 PM, Jennifer Sohn <<a href="mailto:jennifer@sohn-law.com" target="_blank">jennifer@sohn-law.com</a>> wrote:<br><br></div><blockquote type="cite"><div><div dir="ltr">I have a client who is engaging in a 1031 exchange. He recently sold real property that he owned through his living trust. In purchasing the replacement property, my understanding is that he needs to purchase it through his living trust (because that is who sold the relinquished property) or through an LLC where the living trust is a sole member. He will purchase the replacement property with his children as tenants-in-common. <div><br></div><div>Soon after the 1031 exchange, he is planning on setting up an LLC with his living trust and his children (the tenants-in-common) as members. Does this transaction (putting his interest into an LLC that is owned not solely by the living trust but also his children) affect the 1031 tax deferral? My understanding is that he would not be able to purchase through an LLC that has multi-members, so I am wondering if he is able to do that right after the 1031 exchange closes.</div><div><br></div><div>Thanks.<br><div><br></div><div><br></div><div><div><br></div>-- <br><div><div dir="ltr"><p style="margin:0px;padding:0px;color:rgb(0,0,0);font-size:13px;background-image:initial;background-position:initial;background-repeat:initial"><font face="georgia, serif">Best regards,<u></u><u></u></font></p><p style="margin:0px;padding:0px;color:rgb(0,0,0);font-size:13px;background-image:initial;background-position:initial;background-repeat:initial"><font face="georgia, serif"> <u></u><u></u></font></p><p style="margin:0px;padding:0px;color:rgb(0,0,0);font-size:13px;background-image:initial;background-position:initial;background-repeat:initial"><font face="georgia, serif">Jennifer Y. Sohn<u></u><u></u></font></p><p style="margin:0px;padding:0px;color:rgb(0,0,0);font-size:13px;background-image:initial;background-position:initial;background-repeat:initial"><font face="georgia, serif">Attorney at Law<u></u><u></u></font></p><p style="margin:0px;padding:0px;color:rgb(0,0,0);font-size:13px;background-image:initial;background-position:initial;background-repeat:initial"><font face="georgia, serif">(Licensed in CA and WA)<u></u><u></u></font></p><p style="margin:0px;padding:0px;color:rgb(0,0,0);font-size:13px;background-image:initial;background-position:initial;background-repeat:initial"><font face="georgia, serif">Sohn Law PLLC<u></u><u></u></font></p><p style="margin:0px;padding:0px;color:rgb(0,0,0);font-size:13px"><font face="georgia, serif"><span style="background-image:initial;background-position:initial;background-repeat:initial">10900 NE 4th Street, Suite 1850</span><u></u><u></u></font></p><p style="margin:0px;padding:0px;color:rgb(0,0,0);font-size:13px"><font face="georgia, serif"><span style="background-image:initial;background-position:initial;background-repeat:initial">Bellevue, WA 98004</span><u></u><u></u></font></p><p style="margin:0px;padding:0px;color:rgb(0,0,0);font-size:13px;background-image:initial;background-position:initial;background-repeat:initial"><font face="georgia, serif">Tel: <a rel="nofollow" style="margin:0px;padding:0px;text-decoration:underline;color:rgb(25,106,212);outline:none;background:transparent">206.617.7874</a><u></u><u></u></font></p><p style="margin:0px;padding:0px;color:rgb(0,0,0);font-size:13px;background-image:initial;background-position:initial;background-repeat:initial"><font face="georgia, serif">Fax: <a rel="nofollow" style="margin:0px;padding:0px;text-decoration:underline;color:rgb(25,106,212);outline:none;background:transparent">425.732.9748</a> <u></u></font></p><p style="margin:0px;padding:0px;color:rgb(0,0,0);font-size:13px;background-image:initial;background-position:initial;background-repeat:initial"><font face="georgia, serif">Email: <a rel="n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