Section 1031 of the Internal Revenue Code of 1954 provides that no gain or loss will be recognized if certain qualifying property is "exchanged" for like-kind qualifying property rather than sold. The recent case of Starker v. Commissioner, has extended the definition of "exchange" far beyond the typical contemporaneous swapping of property situation to which the section had previously been applied.

I. Introduction

II. The Facts

III. The Government’s Position

IV. The Taxpayer’s Position

V. The Result: A Decision for the Taxpayers