Many people are interested in reverse 1031 exchanges but they are not interested in the 180 holding period cap. The big complaint about rev proc 2037 is that you are only allowed to park a property for up to 180 days, and you can't do much in 180 days. This is especially true if you're doing a construction reverse exchange where you want to construct an enormous amount of improvements. Here are some important things to remember about non-safe harbor 1031 exchanges.
Rev Proc 2037
It's important to note that the IRS does not necessarily say that non-safe harbor exchanges are bad, or make any judgments about them, they just say “if you want to be inside of the safe harbor, stay within the four corners of this revenue procedures.”
Why would you ever want to go outside of the safe harbor? The primary reason is if you need to park a property for longer than 180 days.
Start Your 1031 Exchange: If you have questions about Non-Safe Harbor Exchanges, feel free to call me at 612-643-1031.
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