THE ESSENTIALS OF A 1031 EXCHANGE ROBERT G. HETSLER The Essentials of a 1031 Exchange BY Robert G. Hetsler S avvy investors understand the path to financial success begins with minimizing capital gains taxes. This allows an investor to take money that would otherwise be sent to Uncle Sam, and instead re invest it right away to more quickly build a real estate portfolio. One way to achieve this is by harnessing the power of a 1031 exchange. This powerful wealthbuilding tool allows you to trade up, consolidate, diversify, leverage or relocate your property investments while avoiding capital gains and recapture taxes. With a 1031 exchange, you avoid taxes each time you move from one investment property to the next.