1031 Exchange in Colorado
1031 Exchange · Denver
1031 Exchange in Denver, CO
Front Range owners use 1031/DSTs to step out of active management while deferring Colorado + federal tax.
$559,000Median value
-3.6%Year-over-year
5.0–6.0%Illustrative cap rate
Deferring the tax on a Denver sale
A 1031 exchange lets Denver investors sell appreciated real estate and reinvest into like-kind replacement property — commonly a Delaware Statutory Trust — deferring federal and Colorado capital-gains tax while moving from active landlording to passive, institutional real estate.
Frequently asked questions
What is the capital gains tax rate in Colorado?
Colorado taxes capital gains as ordinary income, up to 4.4%, with no separate long-term rate. Combined with the federal 20% rate and the 3.8% net investment income tax, a high-bracket Colorado seller can face roughly ~28.2% on a real estate gain.
Does Colorado recognize 1031 exchanges?
Yes. Colorado conforms to IRC §1031, so a properly structured exchange defers Colorado tax as well as federal tax.
Why use a 1031 exchange in Colorado?
To defer the tax on a large gain (up to about ~28.2% combined) and move from active landlording into passive, professionally managed real estate while keeping your full equity invested. These are Regulation D offerings for accredited investors.
Considering a 1031 exchange in Denver?Talk to an advisor