Rachel McLaughlin, Exchange Facilitator, discusses how multifamily property owners that choose to sell due to Oregon's rental control Senate Bill 608 can use a 1031 Exchange when acquiring a new investment property . Disclaimer: This presentation is meant to answer general, broad questions about the changes to Oregon Rent Control Senate Bill 608 (“SB 608”). Landlords should consult with an attorney before taking any action as it relates to End of Tenancy/Non-Renewal Notices and/or increasing rent. All opinions are my own. These statements are not meant to be taken as investment advice.

1. Zoe R. York, MAI
260 West 12th Avenue, Eugene, OR 97401
(541) 687-1938 / (541) 683-0932
zoe@duncanbrown.com
www.duncanbrown.com
Rene’ Nelson, CCIM, CRE
895 Country Club Rd, Eugene, OR 97401
(541) 912-6583
rene@1031guru.com
www.eugene-commercial.com
Rachel McLaughlin
Exchange Facilitator
Cascade Title Company
800 Willamette Street, Eugene, OR 97401
(541) 687-2233
rmclaughlin@cascadetitle.com
www.cascadetitle.com
Brian Cox
Real Estate & Property Mgmt Attorney
Brian Cox Law Offices
142 W 8th Avenue, Eugene, OR 97401
(541) 683-7151
bcox@coxassociates.info
www.briancoxeugeneattorney.com

2. Rachel McLaughlin
Exchange Facilitator
Cascade Exchange Services

3. 1031 Exchange Vocabulary
 Relinquished Property
 Replacement Property
 Boot
 Capital Gains
 Qualified Intermediary / Exchange
Coordinator/ Exchange Facilitator/ QI
 Safe Harbor

4. Topics
 Why 1031 exchange?
 Steps of a successful 1031 exchange
 Safe Harbor Rules
 Property Identification Rules
 Types of Exchanges
 Deferred Taxes VS Lifetime Investor
 Things to note
 Frequently Asked Questions

5. Why 1031 Exchange?
 If your plan is to reinvest into real property, a
1031 exchange allows you to defer the capital
gains and reinvest all funds into new investment
property instead of paying upwards of 35% in
federal and state taxes.
 1031 exchanges allow you to keep rolling from
investment to investment without realizing any
gain keeping your money in your investment
portfolio rather than paying capital gains on
each sale.

6. Steps of a 1031 Exchange
 Gather your team (CPA, broker, and Qualified
Intermediary)
 Create an investment plan
 List your relinquished property
 Start shopping for your replacement property if you
haven’t done so already
 Once under contract, loop in your Qualified Intermediary
with the escrow company
 Identify your replacement property/ properties within 45
days of closing on your relinquished property.
 Purchase the replacement property within 180 days of
closing on your relinquished property.

7. Safe Harbor Rules
 Like for Like
 Even or Up
 45 Days to Identify
 180 Days to Purchase
 Use a Qualified Intermediary

8. Property Identification Rules
 3 Property Rule: Exchangor may identify up to 3
replacement properties. Exchangor may elect to
purchase one, two, or all three identified properties.
 200% Rule: Exchangor may identify as many
properties as they desire SO LONG AS the total value
of the identified property does not exceed 200% of
the value of the relinquished property. Exchangor
may purchase any number of identified property.
 95% Rule: Exchangor may identify any number of
replacement property SO LONG AS the exchangor
purchases 95% of the identified properties.

9. Types of Exchanges
 Forward Exchange / Simultaneous Exchange
 Sell first, then buy within 180 days
 Reverse Exchange
 Buy replacement property before the relinquished
property has sold
 Improvement Exchange (Build-to-Suit or
Construction Exchange)
 Use exchange funds to improve the purchase property
 Build new or remodel what is existing
 Multi-Leg Exchange
 Exchange from a large property into a number of smaller
properties

10. Multi-leg Exchanges &
Combining Exchanges
- Combining multiple exchanges to best suit your needs.
- Possible combinations:
- MULTIPLE SALES & 1 PURCHASE
- FORWARD & REVERSE
You dream it up and we can work it out!

11. Deferred Taxes VS. Life Time Investor
 An exchangor can keep exchanging from property
to property throughout their lifetime.
 When the exchangor decides to sell and not
participate in a 1031 exchange – capital gains are
then due on that sale.
 Sale Price – Federal Taxes – State Taxes –
Depreciation Recapture = Exchangor’s Proceeds
 Some investors keep exchanging on their property
and leave the property to their heirs – once the
heirs inherit the property, their basis resets and no
capital gains are recognized on the sale of the
inherited property.

12. Be Aware…
 Title must be identical when exchanging.
 John Smith  John Smith NOT John Smith,
LLC
 Replace debt with debt, not just transfer equity
 Primary residences do not qualify for exchange
treatment.

13. Frequently Asked Questions:
 Can I extend my timeline?
 What if I don’t find a replacement property?
 What if all of my identified properties fall
through?
 What if I do not purchase equal or up in value?
 Can I sell two properties and purchase one big
property?
 Can I exchange my owner occupied duplex?
 Can I purchase a vacation home for personal use
and also rent it out

14. Where Do I Go Now?
Visit Rene’s Website For Latest Information…
Oregon Rent Control Center
www.eugenecommercial.com

15. For further information:
Zoe York – zoe@duncanbrown.com
(541) 687-1938
Rene’ Nelson – rene@1031guru.com
(541) 912-6583
Rachel McLaughlin –
rmclaughlin@cascadetitle.com
(541) 687-2233
Brian Cox – bcox@coxassociates.info
(541) 683-7151