Exchange Type
1031 Deferred / Delayed Exchange
The most common type of 1031 exchange. Sell your relinquished property first, then identify and acquire your replacement property within the 45 and 180-day statutory windows.
Exchange Type
The most common type of 1031 exchange. Sell your relinquished property first, then identify and acquire your replacement property within the 45 and 180-day statutory windows.
A 1031 Deferred Exchange — often referred to as a Delayed Exchange or like-kind exchange — allows real estate investors to defer capital gains taxes on the sale of a property, provided the proceeds are reinvested in another similar property within a specific time frame. Unlike a simultaneous exchange, a deferred exchange gives investors additional time to identify and acquire a suitable replacement property.
Select a reputable QI before you sign the sale contract. The QI will hold all exchange proceeds and guide compliance throughout.
Proceeds from the sale transfer directly to the QI — you cannot receive or control the funds at any point.
Submit a written identification to your QI within 45 days using the 3-Property Rule, 200% Rule, or 95% Rule.
The QI uses held funds to close on one or more identified replacement properties within 180 days of your sale.
Report the exchange at tax time using Form 8824, confirming both properties and the tax deferral structure.
Reinvest the full sale proceeds without paying taxes upfront — allowing for compounded portfolio growth.
Diversify or consolidate holdings — sell one property and acquire multiple smaller ones, or vice versa.
Heirs may benefit from a step-up in basis, potentially erasing the deferred tax obligation entirely.
Reinvest into higher-income properties to grow cash flow and appreciation potential strategically.
If the replacement property costs less than the relinquished property, or if any cash or debt relief is received, a taxable "boot" can result. Partial exchanges can complicate the transaction and may lead to unintended tax consequences. Our legal team structures every exchange to minimize boot exposure from day one.
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