In a real estate context, what is referred to as "boot"?

In real estate transactions, "boot" refers specifically to any form of non-like-kind property or cash that is received in addition to the primary asset in a 1031 exchange. When a property owner decides to exchange one property for another while deferring the capital gains tax, they ideally want to exchange properties of equal value. However, if the property received is of lesser value or if additional cash is included in the transaction, that cash not connected to the investment is termed "boot."

This term is significant in tax law and real estate because receiving boot can trigger a taxable event, meaning that the owner might have to pay taxes on the portion of the transaction classified as boot. Understanding boot is crucial for real estate investors as they navigate the complexities of exchanges and tax implications.

The other options do not accurately capture the essence of what "boot" means in this context. Thus, recognizing "cash given in a transaction" as boot highlights the transactional aspect related to tax deferrals in property exchanges.