[Nancy]

Mac,

Yes, like-kind exchange rules apply to personal property as well as real property. It's so straight forward and simple with personal property that you probably have been doing it and haven't given it much thought that it was just that.

Personal property (and for those reading this who may not know, when I say personal property, I mean tangible property use in a trade or business and not personal use property) gets the deferred treatment when it is like-class, which mean they fall under the same General Asset Class or Product Class. Cars are obviously like-class. But you can also trade a computer for a printer and defer any depreciation recapture also since they are in the same "general asset class". But you could not do it when trading a car for say, an airplane, because, even though they are both modes of transportation they are not in the same asset class. Like-kind and like-class are treated the same.

You are probably more aware of the 1031 like-kind exchange rules for real estate and legal cases because those transactions are more of a to-do due to the nature and value of the assets involved. The Starker Ruling exchange provisions (3+ way exchanges) are commonly seen in real estate transactions, although these rules can be invoked for personal property transactions too. Personal property is just usually a lesser deal than real property so people might not be aware they are sometimes effectively doing the same thing under tax law.

Nancy