1031 EXCHANGES SIMPLIFIED

Tax deferred exchanges do not need to be difficult. However, there are a few basic rules that you should understand to comply with the legal requirements. Although we provide a considerable amount of information, it is recommended that you seek the counsel of your accountant and attorney to obtain professional advice specific to your tax situation.

PLAN YOUR EXCHANGE

The first step to any exchange is to determine the suitability for you and your property. For instance, both the property you sell as well as the property you acquire must be "like-kind" and held for a qualifying purpose. This means you need to either be holding the property for investment, or holding it for income. In addition, the new property must be acquired by the same taxpayer that sold the old investment property.

SELECT YOUR FACILITATOR

Engaging the services of an experienced and capable Qualified Intermediary or Facilitator is critical to your exchange. Choosing a well-established company like IPX1031, the nation's largest Facilitator, can represent the easiest method for getting your questions answered quickly and completing your exchange in a safe and successful manner.

IDENTIFY NEW PROPERTY

There are two critical deadlines in every 1031 exchange. First, you must identify candidate or target Replacement Properties within 45 days from the transfer of the property you sell. There are rules for identification that are explained here. Secondly, you will need to close on your Replacement Property within 180 days from the transfer of the property you sell, or the tax return due date (for the tax year of the sale).

TYPES OF EXCHANGES

There are a few different types of exchanges possible, depending upon the circumstances of your sale and purchase situation.

DEFERRED EXCHANGE

These are the most common exchanges in which you have a total of 180 days to transfer your old property and to acquire your new property.

REVERSE EXCHANGES

Sometimes circumstances may dictate that you must buy before you sell. This is known as a Reverse Exchange. An explanatory video is available here.

CONSTRUCTION EXCHANGES

Often a Replacement Property requires some improvements to be constructed in order to meet the intended use of the Exchanger. This video explains construction exchanges in more detail.

1031 EXCHANGE TUTORIALS

  • Expertise
    1031 EXCHANGE GUIDE
    This tax deferred exchange guide will not only explain the rules with which you will need to be familiar, it will also suggest the pitfalls to avoid which will ensure your exchange is successful.
  • Planning
    1031 QUESTIONS / ANSWERS
    If you are just looking for a quick answer to a specific question, the answer can likely be found here. We've amassed most of the most common tax deferred exchange related questions and answers.
  • Processing
    IDENTIFICATION
    The most difficult aspect of any exchange is successfully identifying your Replacement Property within the 45 day identification time period. The IRS has specific ID rules with which you should be familiar.
Kyle Williams

HAVE 1031 QUESTIONS?

ASK OUR EXPERTS AT IPX1031

1031 exchanges don't have to be difficult. However, because exchanges can sometimes involve complicated logistics and require specific compliance with IRS rules, it pays to have access to an expert who can easily keep your 1031 on track.

The information included here is provided by IPX1031, America’s largest Qualified Intermediary for 1031 exchanges and a subsidiary of Fortune 300 Fidelity National Financial.

If you have questions, typically, it only takes a few minutes on the phone with an IPX expert to walk through your transaction with you and ensure your 1031 exchange will occur seamlessly.

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CAPITAL GAIN ESTIMATOR

45 / 180 DAY CALCULATOR