A limitation of Section 1031 like-kind exchanges was included among revisions to Secretary Hillary Clinton’s tax proposals on Thursday, September 22, 2016. The policy changes are aimed at reforming capital taxation, according to her campaign website. The proposed limitation on Section 1031 is believed to be similar to the Administration’s FY2017 budget. President Obama’s FY2017 proposal limited capital gains deferral to $1 million per taxpayer per year for both real and personal property and excluded art and collectibles from eligibility. According to the Center for a Responsible Federal Budget, the inclusion would be expected to raise more than $35 billion dollars that would go towards funding her proposals.
Last week, FEA and several other associations that represent end users of like-kind exchanges sent letters to both the Clinton and Trump campaigns, urging the preservation of the provision. Copies of the EY and Ling-Petrova economic studies were included with these letters.