I If you’re new to the world of section #1031 of the IRS Tax Code, the terminology that comes along with these tax saving exchanges can be confusing. To help you understand the phrases you will undoubtedly hear if you choose to complete a taxdeferred 1031 Key Vocabulary for 1031 Exchanges exchange, here’s a list of the key terms you will come across. LikeKind: A term that refers to the nature or character of the property being exchanged. In order for the exchange to qualify for taxdeferred status, both the relinquished and replacement property must meet the IRS definition of likekind. Boot: This is the fair market value of any nonqualified property you receive during the exchange. It can be cash, loans, property, reduction in debt or even supplies. Basically, anything of value that you receive during the exchange could be considered boot.