Final answer:
The exchange between an investment office building and a building intended for business use does not qualify as a like-kind exchange because they don't meet the same-purpose requirement.
Step-by-step explanation:
The question asks if the exchange of one office building held as an investment for another that will be used in the taxpayer's business will qualify as a like-kind exchange. According to IRS guidelines under Section 1031, in order for a property exchange to be considered like-kind, both properties must be held for use in a trade or business or for investment. However, since one property is held as an investment and the other is intended for use in a trade or business, they do not satisfy the same-purpose requirement for a like-kind exchange. Therefore, this exchange would not qualify as like-kind due to the differing intents for the properties being exchanged.
The exchange of one office building held as an investment for another intended for use in the taxpayer's business would not qualify as a like-kind exchange according to IRS guidelines under Section 1031. To meet the like-kind exchange criteria, both properties must be held either for use in a trade or business or for investment. In this case, the divergence in the intended use of the properties—one held for investment and the other intended for business operations—precludes them from satisfying the same-purpose requirement for a like-kind exchange. Therefore, the exchange does not meet the criteria for like-kind treatment, as the properties serve different purposes, one being held for investment and the other intended for active business use.