If I am an owner of investment property in conjunction with others, may I exchange only my partial interest in the property? Yes. Partial interests qualify for exchanging within the scope of Section 1031. However, if your interest is not in the property but actually an interest in the partnership which owns the property, your exchange would not qualify. This is because partnership interests are excepted from Section 1031. But don't be confused! If the entire partnership desired to stay together and exchange their property for a replacement, that would qualify.
Exchange your partial, undivided interest in a real property just like you'd exchange the entore property.
