1031 Exchanges
Delayed 1031 Exchange
The delayed 1031 exchange allows an investor a maximum of 45 days to identify the replacement property and 180 days to complete the purchase of the replacement property.
Overview
The delayed 1031 exchange is the most common type of exchange used by our customers. This is when the exchanger sells, or relinquishes the original property before he acquires the replacement property. The delayed 1031 exchange allows an investor a maximum of 45 days to identify the replacement property and 180 days to complete the purchase of the replacement property.
How it works
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Sell the original property
The exchanger sells, or relinquishes, the original property before acquiring the replacement property.
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Identify the replacement (45 days)
The investor has a maximum of 45 days to identify the replacement property.
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Complete the purchase (180 days)
The investor has 180 days to complete the purchase of the replacement property.
Best for
- Investors selling one property and buying another
- Straightforward sale-then-purchase timing
Key considerations
- The 45-day and 180-day clocks both start at the sale closing
- Exchange funds must be held by the qualified intermediary
- Replacement identification rules are strict - confirm with your advisors
FAQs
When do the deadlines start?
Both the 45-day identification period and the 180-day completion period begin on the date the relinquished property sale closes.
Can I touch the sale proceeds?
No. To preserve a 1031 exchange, proceeds are held by the qualified intermediary. Confirm specifics with your tax advisor.
Start your Texas 1031 with Cedar Top
Tell us about your transaction and we’ll help you get set up. Remember to involve your CPA, attorney, and tax advisor.