Team Molzan - Holiday Realty

"Like-kind" does not refer to the type of property. Instead, it addresses the intended use of the property. Provided the property was initially acquired and held for either a business or investment purposes, it can qualify as a suitable replacement property, a rental house for a retail center or an apartment building for an office building. Investors do not have to exchange for exactly the same type of property they are relinquishing.

The tax code also lists items that are not considered "like-kind" and are expressly excluded from non-recognition. These include:

stock in trade or other property held primarily for sale;
stocks, bonds, or notes;
other securities or evidences of indebtedness;
interests in a partnership;
certificates of trust or beneficial interest;
chooses in action.

In addition, the Code was amended in 1989 rendering property outside the United States non "like-kind".