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The 1031 Process & Requirements
Everything you need to complete a successful, IRS compliant exchange
Engage a Qualified Intermediary
Contact a Qualified Intermediary before you close on your sale.
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What a QI does:
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Prepare all exchange documents
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Coordinate with your closing team
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Setup an Escrow account
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Note: If you receive proceeds directly, your exchanfe is permantenty disqualified.
1
Sell Your Property (Day 0)
Your property sale closes normally, but proceeds go directly to your QI's escrow account instead to you​
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What happens:
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Sale closes with your closing agent
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Proceeds wired to your QI
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The 45 and 180 Day exchange timeline begins
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2
Identify Replacement Property
You have exactly 45 calendar days from your sale closing to identify potential replacement properties in writing ​
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Identification rules (choose one)
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Three-Property Rule: Identify up to 3 properties of any value
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200% Rule: Identify any number of properties if total value doesn't exceed 200% of your sold property
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95% Rule: Identify any number of properties if you close on 95% of identified value
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3
Purchase Replacement Property
Close on your replacement property within 180 days of your sale.​
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Requirements:
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Property must be equal or greater value
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Reinvest all of your net equity
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Title in same taxpayer name
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Must be a property you identified
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4
5
Exchange Complete
