You Can Use a 1031 Exchange to Re-invest from Real Estate into Oil & Gas

In the early 1940s, court rulings affirmed that oil and gas royalties and working interests qualify as "like-kind" to all other forms of Real Property.   Since these rulings, investors have been able to take advantage of the 1031 tax deferral by exchanging between brick-and-mortar real estate and oil and gas properties.

Monthly cash flow is generated from the sale of oil and/or natural gas produced on the property. Cash flow is usually aggregated for all wells in the investment and paid monthly based on your percentage interest. Your purchase is often diversified to include wells at various stages in their production life span from recently drilled to 30 years of production. And, many investments include rights to your percentage of any additional production developed on your property in the future. Your investment is not used to underwrite development of new fields or drilling of new wells.

Energy replacement property options include royalty programs, working interest programs or a combination of both. Regardless of which option you choose, potential cash flow and overall property value will be determined by monthly production capacity, monthly revenue, commodity pricing and engineering reports regarding future production potential.

One of the many advantages of energy assets is that, unlike buying a building, an energy asset purchase can often be tailored to the exact valuation required for your exchange. Some alternatives on the market even provide the ability to tailor the exact amount of debt desired by an investor. This is of particular interest to 1031 exchangers looking to match debt to avoid boot. In addition, many energy replacement property options offer a much lower minimum investment requirement than many traditional real estate or Tenant In Common (TIC) investments.

We Sell Oil & Gas Investments

Royalties * Working Interests * Existing Production

New Drilling * Re-work * 1031 Exchange

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Toll Free Phone: 888 543-2103

Securities offered through Empire Securities, member FINRA, SIPC.

• For Informational Use Only.  This is neither an offer to sell nor a solicitation to buy any security.  These products do contain a risk of the loss of principal and they are NOT covered by SIPC.  Investments are subject to various risks such as illiquidity, adverse economic conditions and adverse market conditions. May not be suitable for all investors. Accredited investors only.  Past performance does not guarantee future results