ForConstructionPros.com

See the diagrams in this article which highlight the pass-through and safe-harbor Like Kind Exhange transactions. As you can see, LKE's are complicated and even the experts have a hard time agreeing on certain issues.

Jeff Nelson can be reached at ph. (612) 889-5973 or jeff.nelson@us.pwc.com. Accruit, by the way, has a document that discusses this issue in more detail. Please contact Accruit at ph. (720) 963-5000 to receive your copy.

LKE's can provide a significant benefit for rental companies, dealers and contractors if used properly. Please make an effort to understand the basic LKE qualification concepts and be wary of any transaction where a qualified intermediary is not part of the process. The sales tax issues should also be reviewed with your tax advisor.

Editor's Note: This article is not intended to be tax advice. Readers should contact their tax accountants for professional tax service.

Garry Bartecki is director of dealer/distributor services at BDO Seidman LLP of Chicago, as well as consultant to Associated Equipment Distributors (AED). He has also worked as an independent CPA and consultant to equipment dealers. He can be reached by phone at (312) 616-4677 or email at gbartecki@bdo.com.