Apr 16, 2024
Internal Revenue Code Section 1031 permits taxpayers to defer paying tax on gain for federal income tax purposes when they invest in real estate and exchange one property for another property. In Pennsylvania, whether or not taxpayers can defer gain pursuant to Section 1031 for state personal income tax purposes has been contested for years. In Pearlstein v. Commonwealth, the decision from the state Supreme Court will be a test as to whether the DOR can effectively ignore the language of its own statutes and corresponding regulations.
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