We talk a lot about 1031 exchanges from the buyer’s perspective. In this article, we’d like to turn the tables and take a look at things from the seller’s perspective.
1031 Considerations for the Seller
If you are selling a property and you discover the buyer intends to involve the property in a 1031 exchange, there are a few things you should add into your contract. Specifically, it’s important to include language that:
you're aware of the buyer's intent to complete a 1031 exchange,
you agree to cooperate at no additional cost or liability to you, and
you're aware that the buyer has certain rights assigned to a third party (the qualified intermediary).
This type of verbiage is essential to include in the contract so every party is on the same page that the property will be involved in a 1031 exchange.
1031 Timelines
It’s also important to be aware of the timelines that govern 1031 exchanges. If your buyer intends to acquire your property in a 1031 exchange, they must acquire the property within 180 days of selling their relinquished property. This may impact your closing date so it’s important to keep in mind.
1031 Exchange Company
CPEC1031 is a 1031 exchange company with twenty years of experience in the like-kind exchange industry. Our qualified intermediaries are ready and able to help you with your 1031 exchange – no matter how simple or complex. Contact us today to learn more about our range of services and how we can help you save money when selling investment real estate. Our main office is located in downtown Minneapolis, but you can reach us across the country at one of our numerous satellite offices as well.
Start Your 1031 Exchange: If you have questions about 1031 exchanges, feel free to call me at 612-643-1031.
Defer the tax. Maximize your gain.
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