Tax-deferred exchanges are often referred to as tax-free.
Certain exchanges allow investors to trade one piece of property for another piece without paying income tax on the transaction. If you sell a piece of business or investment property for cash, you may owe tax on the transaction. However, if you follow certain rules, you can exchange property for like-kind property and postpone the tax consequences of the sale.
That allows you to keep all of your money invested instead of turning some of it over to the IRS. If you are considering this as an investment option, beware. The rules can be complex and the IRS is very particular about following the rules when exchanging property.
Your best bet. Ask for help before participating in an exchange.