Real estate investors commonly relinquish one property and obtain another via a “like-kind exchange.” In a properly-executed like-kind exchange, you’ll wind up owning Property B, not Property A, and you’ll owe no income tax on the maneuver. (Like-kind exchanges are permitted on investment/business properties but not residences.)
The new tax law changes the sell-vs.-exchange equation. In some situations, you may be better off selling your existing property and buying a new one, rather than exchanging. You can wind up with a lower tax bill while avoiding the expense and time pressure involved with a like-kind exchange.
With a like-kind exchange, you’ll avoid the tax on a property sale.
Under the new tax law, though, the rate on long-term capital gains is now 15 percent, rather than 20 percent. Therefore, the tax bite on a sale-and-purchase will be less painful than it was under prior law. The tax bill may be wiped out altogether, if you can offset your gains from a property sale with stock market losses.