- 1031 Exchanges
- Tenants-In-Common
- Exchange Details & Requirements
- Real Estate Professional
Dual Registration Program - Tax Professionals, Legal Advisors & Northland Securities1031
- About Us
- The Tax Deferred Exchange
- How to Initiate an Exchange
- 1031 Exchange Requirements
- Do's & Don'ts of 1031 Exchange Planning
- Can Your Tax Professional or Legal Advisor Be Your Qualified Intermediary?
- Exchange Terminology
- Like-Kind Property
- 1031 Qualified Property
- Delayed Exchange Deadlines
- Tenant-In-Common Interests
- Master Lease-Tenants-In-Common
- Non-Tax Reasons to Exchange
- Role & Selection of a Qualified Intermediary
- Role of a Tax Professional or
Legal Advisors - Disqualified Parties
- Tenants-in-Common Research &
Due Diligence Reports - Exchange Language
Exchange Details & Requirements
The Tax Deferred Exchange
Section 1031 of the Internal Revenue Code provides that no gain or loss shall be recognized on the exchange of property held for investment or productive use in a trade or business. A successfully completed exchange allows for disposal of investment property, deferral of capital gains tax and use of all equity to acquire replacement property.
In any exchange the Exchanger must enter into the exchange transaction prior to the close of the relinquished property. The Exchanger and the Qualified Intermediary (Q.I.) enter into an Exchange Agreement, which requires that:
- The Q.I. acquires the relinquished property from the Exchanger and transfers it to the buyer by direct deed from the Exchanger
- The Q.I. acquires the replacement property from the seller and transfers it to the Exchanger by direct deed from the seller.
- The cash or other proceeds from the relinquished property are assigned to the Q.I. and are held by the Q.I. in a separate, secure account. The exchange funds are used by the Q.I. to purchase the replacement property for the Exchanger.