Worcester Business Journal

16 Worcester Business Journal | September 26, 2016 | wbjournal.com F O C U S B U S I N E S S & T H E L A W A multi-family home, a Jackson Pollock painting and a high-speed ferry boat. While at first these disparate items seem to have nothing in common, they are all properties the Exchange Authority has helped change hands, brokering exchanges of property that work to avoid or post- pone the tax implications of transfer- ring ownership. The Leominster company has been assisting with exchanges since 1999 and now with a new president and CEO in Robert Charland, the compa- ny is looking to bring the 1031 Code of the Internal Revenue Service to more people. Charland practiced real estate law in Leominster for a number of years before joining the company last year as the CEO and then transitioning to the president's role asl well in August. While he plans to grow the business and spread the word of its services, the company – at its core – is extremely specialized, which is a boon in the industry of 1031 exchanges, he said. "It's vital to have someone to talk to," Charland said. "It's a specialty where you need to know all the details." From $50K to multi-million The Exchange Authority specializes in 1031 exchanges. These exchanges are a tax-deferral method that allows a property owner to trade one business property for another they will keep for a minimum of two years without hav- ing to pay federal income taxes on the transaction. So while usually capital gains must be paid at the time of the sale, they can be deferred until the person sells the new property. This can provide the ability for peo- ple to put those capital gains right back into the next property or business. This can help push the transfer of a property Horse-trading tax payments Leominster firm growing by offering exotic & mundane exchanges to clients looking to avoid paying taxes BY SAM BONACCI Worcester Business Journal Digital Editor that might otherwise have been held back due to capital gains, said Tim Halligan, the company's co-founder for- mer CEO and co-founder. It can also allow property owners to get into different forms of income properties, such as transferring out of a self-managed apartment building and into a partial stake in a larger rental property, a fast-food franchise location or a rental property in Florida. It can even be used to transfer business-use property such as construction equipment. "We've done exchanges from as little as $50,000 dollars to multi-million dol- lar exchanges," Charland said. "It can benefit anybody who wants to reinvest. It gives you that extra cash flow to put towards the next property." All of this must be done through a qualified intermediary third party that can have no other dealings with the transaction, which is where the Exchange Authority President and CEO Robert Charland is leading the company forward in a niche industry that requires attention to detail and an understanding of a particular piece of tax law. One of Exchange Authority's unique deals was trading partial ownership in a Jackson Pollock painting for two others. Here is Pollock's painting "Alchemy" made in 1947. P H O T O / D E T L E F S C H O B A R T

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