Workout-Driven Exchanges

25 Tax Mgmt. Real Est. J. 23 (Feb. 4, 2009)

35 Pages Posted: 11 Dec 2008 Last revised: 6 Mar 2013

Date Written: March 5, 2013


Market forces in a depressed real estate market often lead to foreclosures, which may generate taxable gain to the debtor. Some foreclosure sales may qualify for Section 1031 nonrecognition, if the debtor properly structures the disposition. This Article discusses structures that help foreclosure transactions qualify for Section 1031 nonrecogntion. The Article also discusses the application of Section 1038 to recquisitions of exchanger-financed relinquished property.

Keywords: foreclosure, section 108, cod income, doi income, section 1031, tax-free exchange, like-kind exchange, section 1038

Suggested Citation

Borden, Bradley T. and Keator, Todd D., Workout-Driven Exchanges (March 5, 2013). 25 Tax Mgmt. Real Est. J. 23 (Feb. 4, 2009), Available at SSRN: or

Bradley T. Borden (Contact Author)

Brooklyn Law School ( email )

250 Joralemon Street
Brooklyn, NY 11201
United States


Todd D. Keator

Thompson & Knight LLP ( email )

1700 Pacific Avenue
Dallas, TX 75201-7322
United States

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