Posted by Jimmy on May 23, 2006 at 10:12:49:
the salaries you guys have colelcted are payments from the S Corp your personal services. This is W-2 income, subject to the full array of payroll taxes and income taxes. the gain from the sale of a property will (almost always) be capital gain. this gain has nothing to do with personal services. rather, it is a benefit of ownership.
as for the mechanics of the 1031… you ask some wonderful questions. and I am no expert. I know enough to mention the idea. you really want to talk to a CPA or tax atty who has transacted many of these deals. No point in me trying to dream up a way of doing this, when there are experts out there who already know (and know how to do it right!)
as for what constitutes “like kind” the rules are very liberal. an office tower for a working ranch is ok. a 4-plex would be fine.