Internal Revenue Code, Section 1031, states that neither gain nor loss is recognized if property held for investment or for productive use in a trade or business is exchanged for property held for investment or for use in a trade or business. There are several types of 1031 exchange methods used today, including delayed exchanges, simultaneous exchanges, and reverse exchanges. | COLLIERS INTERNATIONAL Real Estate Glossary Term Definition 1031 exchange Internal Revenue Code Section 1031 states that neither gain nor loss is recognized if property held for investment or for productive use in a trade or business is exchanged for property held for investment or for use in a trade or business. There are several types of 1031 exchange methods used today including delayed exchanges simultaneous exchanges and reverse exchanges. 30-day notice Notice to vacate a premises under a periodic tenancy. Notice must be for the rent period but not more than 30 days. See periodic tenancy 401 k retirement plan 401 k retirement plans allow an individual to contribute part of their pre-tax income to an investment account. Pre-tax contributions are not tax-free they are tax-deferred meaning the person does not pay income tax on this money until they withdraw it from the plan which should be at retirement . Some companies offer to match the individual s contribution as an incentive to join the company s retirement plan. Depending on the provisions of a company s retirement plan a person may take a loan from their 401 k account. Not all plans allow for loans. The loan is paid back plus interest a fixed rate determined at the time of the loan through after-tax payroll deductions. As long as the individual repays the loan on time they are not subject to withholding taxes or penalties. abatement 1. A reduction or decrease. 2. The removal of a nuisance. abatement rental A reduction or elimination of rent payments for a specified period of time usually granted by the landlord as an inducement to the tenant to enter into or renew a lease. abatement tax A reduction in real property tax granted by a taxing authority as the result of an appeal. In some jurisdictions tax abatements may also be granted as an inducement for development or to attract or retain job-providing industries. absorption The net statistical change in occupied space over a period of time generally year .
