Farmland and Ranch 1031 Exchange

We have handled exchanges involving farmland, and Texas land is one of the more flexible exchange situations. Land held for investment or business use can generally be exchanged for any other real property held for investment or business use. That means farmland or a ranch can be replaced with another tract, an apartment building, a shopping center, or a gas station, and the reverse works too.

Only real property counts. Land, barns, fences, and permanent structures are generally part of the exchange, while crops, livestock, and farm equipment are not. Mineral and water rights can also be real property in Texas, depending on how they are held and conveyed, so these should be reviewed before closing.

Rural deals can be slower than city deals. Surveys, access, wells, septic, and old title questions can take extra time, and your 45 day and 180 day deadlines do not pause while they are sorted out. If you are selling to a developer or a neighbor, speak with us before you sign the contract so the exchange language is in place.

Whether the land has been in your family or you bought it as an investment, talk to us before you sell, and consult with a CPA or tax attorney to confirm how the rules apply to you.