Realized 1031 Glossary of Terms

Related Party

Written by The Realized Team | Jul 18, 2022 12:00:00 PM

Generally speaking, related party issues are technical and we recommend consulting with your CPA or tax attorney to understand how the “related party” rules may impact your specific situation.

In technical speak, Section 1400Z-2(e)(2) modifies the related party test in §179(d)(2) by substituting ‘‘20%’’ for ‘‘50%’’ each place it appears in §267(b) and §707(b)(1).  A layman’s read would indicate that the statute appears to be making it harder for related party transactions by lowering the threshold from 50% to 20%.