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Partnership Exchanges: Section 1031, Drop and Swaps, Swap and Drops, Mixing Bowl, and Other Strategies

Recording of a 110-minute CPE webinar with Q&A

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Conducted on Wednesday, August 9, 2023

Recorded event now available

or call 1-800-926-7926

This course will explain methods available to swap assets held in partnerships, including methods that combine eligibility for Section 1031 treatment. Our panel of partnership tax experts will explain drop and swap, swap and drop, and mixing bowl strategies available to partners that allow for an exchange of assets while deferring tax on any inherent gain.


Section 1031 specifically excludes partnership interests as eligible property for like-kind exchanges. Drop and swaps allow partners to receive individual ownership interests separately so that each partner can do a 1031 exchange or exit a partnership or LLC as they prefer. The investment is dropped into a tenancy in common (TIC) and subsequently swapped. The conversion must comply with complex regulations for the transaction to be respected. The timing of the drop and the swap is critical.

A mixing bowl structure enables partners to trade assets by contributing the assets to a newly created partnership and to defer the tax on the exchange. However, the partners must execute the transaction correctly to avoid the disguised sale and anti-mixing bowl sanctions. Tax advisers working with partnerships and LLCs need to understand how these transactions are structured so that taxpayers can defer taxes on their investments.

Listen as our authoritative panel explains strategies to exchange assets, preserve the benefits of Section 1031, and avoid anti-mixing bowl rules and other sanctions.



  1. Partnership exchanges: an overview
  2. Drop and swaps
  3. Swap and drops
  4. Mixing bowl strategies
  5. S corporation drop and swaps
  6. Other exchange techniques
  7. Avoiding sanctions


The panel will review these and other critical issues:

  • Key timing considerations for drop and swap exchanges
  • Satisfying use and holding requirements for drop and swaps
  • Avoiding recognition of pre-contribution gain in mixing bowl transactions
  • Tax considerations for S corporation drop and swaps


Borden, Bradley
Professor Bradley T. (Brad) Borden

Professor of Law
Brooklyn Law School

Professor Borden’s research, scholarship, and teaching focus on taxation of real property transactions and...  |  Read More

Flavin, Marie
Marie C. Flavin

Senior Vice President/Northeast Regional Manager
Investment Property Exchange Services

Ms. Flavin is a member of the New York and Connecticut Bars, and has been practicing real estate law since 1992. She...  |  Read More

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