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GENERAL REQUIREMENTS FOR A LIKE-KIND EXCHANGE ("EXCHANGE") PURSUANT TO SECTION 1031 OF THE INTERNAL REVENUE CODE OF 1986

When selling business or investment real estate property, you may defer capital gains tax with a 1031 Exchange. In a typical exchange transaction, the taxpayer sells an investment property and acquires replacement property of equal or greater value within 180 days. The use of a Qualified Intermediary (QI) is a safe harbor requirement for a valid tax deferred exchange.

Step one:

Before the sale of the first property the exchanger must complete the necessary documentation prepared by a Qualified Intermediary. On closing, the proceeds are delivered directly to the Qualified Intermediary.

Step two:

The exchanger must identify the property to be purchased within 45 days following the sale of the relinquished property. The exchanger may generally identify up to three properties as potential replacement properties, or more properties subject to certain limitations.

Step three:

The exchanger must obtain the replacement property within 180 days following the sale of the relinquished property, which must be one of the identified properties. On closing, the proceeds are paid directly by the Qualified Intermediary and then the exchanger receives the deed to the replacement property.

1031 EXCHANGE TRANSACTION LEGAL DOCUMENTATION

Our attorneys provide legal documentation for the exchange transaction for property located anywhere in the United States. Our attorneys make the exchange process simple and easy to follow, keeping you abreast of the exchange every step of the way.

The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation.
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