Video - Questions to Ask When Vetting a Qualified Intermediary

When conducting a 1031 exchange, it’s important to properly vet your qualified intermediary. Here are some questions to ask about your qualified intermediary before you make the decision to hire them for your like-kind exchange:

• Do they have a professional license? Are they an attorney licensed to practice law? Are they a CPA who’s gone through that rigorous examination?

• Do they have an A+ rating with the BBB? Do they have a lot of good reviews on Google?

• Have they been in business for decades or are they new to the industry?

• Are they actually authorized to do business in your state?

• Do they use separate, segregated bank accounts or do they put all their client monies into one bucket?

CPEC1031, LLC – Your 1031 Exchange Resource

CPEC1031, LLC is your resource for all things related to 1031 exchanges. For the past several decades, we have been helping taxpayers just like you defer taxes under section 1031 of the Internal Revenue Code. We can help you keep your money working in a continued investment. Contact us today to learn more about the 1031 exchange process, its benefits, and how we can help facilitate your next like-kind exchange. Our team operates out of our primary office in downtown Minneapolis but we work with clients across the United States.

• 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.

© 2025 Copyright Jeffrey R. Peterson All Rights Reserved

7 Steps to Conducting a Successful Reverse 1031 Exchange

A reverse 1031 exchange allows you to preserve your ability to defer taxes, even when buying before selling. In this article, we outline seven steps to conducting a successful reverse 1031 exchange.

Form the Holding LLC

We establish a single-purpose LLC to act as the Exchange Accommodation Titleholder (EAT). This entity will initially be owned by CPEC1031, LLC to hold title to your “parked” replacement property.

Execute Reverse Exchange Agreements

We draft and circulate the necessary 1031 exchange documentation, including the reverse exchange agreement, for your review and electronic signature.

Acquire and Hold the Replacement Property

Using your cash and/or bank financing, the LLC closes on the new property and holds title for up to 180 days while you arrange to sell your relinquished real property.

Operate via Triple-Net Lease

The LLC leases the “parked” property back to you, allowing you to manage, collect revenue, and cover expenses like insurance, taxes, and maintenance during the holding period.

Secure Insurance Coverage

Provide an insurance certificate naming you, the bank, and the EAT (Exchange Accommodation Titleholder) as insured parties under your liability and property coverage.

Close on the Sale & Complete Exchange

Once your relinquished property closes through CPEC1031, LLC, we apply the net proceeds to repay any loans or costs. Then, we transfer ownership of the replacement property to you, which completes the reverse exchange.

Final Tax Reporting: Close-Out Letter & IRS Filing

CPEC1031, LLC issues a final summary letter documenting key dates and utilization of funds. Then, you’ll report the exchange on IRS Form 8824 with your tax professional as part of your federal tax return.

Considering a Reverse 1031 Exchange?

We’ll guide you through the reverse 1031 exchange process. Reverse 1031 exchanges are complex but our team has the experience and structure to handle them seamlessly.

• 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.

© 2025 Copyright Jeffrey R. Peterson All Rights Reserved

Video - Don’t Cash Out: A History Lesson for 1031 Exchanges

Let’s do a little 1031 exchange history lesson.

If you go back in the tax code, we had a hodgepodge of laws with very little rhyme or reason. Congress would pass a law and stick it in the book. In 1921, the first iteration of the 1031 exchange was put in the code. However, it wasn’t called a “1031 exchange” yet because the Internal Revenue Code as we know it now didn’t even exist.

That first version allowed for the deferral of tax when there was a swap (of real estate or other assets). The contemplated modality was that you trade someone your farm and the other party trades you their farm in a simple swap. The thinking was that people in that situation shouldn’t be penalized with taxes if they’re just continuing their investment in a different but equivalent property. That rationale continues to this day in the realm of 1031 exchanges – don’t cash out!

Reinvest Your Sales Proceeds and Defer Your Capital Gains Taxes in a Like-Kind Exchange

With a 1031 exchange, you can defer your capital gains taxes by reinvesting the net proceeds from the sale of investment real estate. The benefits of doing so are numerous. You get to keep your money compounding and building over time in a continued investment rather than simply paying a big tax bill. Like-kind exchanges can be conducted by any US taxpayer – provided your property meets certain benchmarks. Contact the intermediaries at CPEC1031, LLC today to get help with your next 1031 exchange of investment real estate.

• 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.

© 2025 Copyright Jeffrey R. Peterson All Rights Reserved

4 Steps to a Successful 1031 Exchange

Selling investment property? If you're hoping to defer capital gains taxes and reinvest into another property, a 1031 exchange might be your smartest move. But this powerful tax-deferral strategy comes with strict rules—and missteps can be costly.

Let’s walk through the four essential steps you’ll need to follow for a smooth, IRS-compliant 1031 exchange.

1. Add a 1031 Exchange Clause to Your Purchase Agreement

To get started on the right foot, your intent to do a 1031 Exchange needs to be documented from the beginning. Adding a 1031 exchange clause to the purchase agreement notifies the buyer and helps preserve your eligibility. It’s a small but critical step that signals your plan to defer taxes.

2. Engage Your Qualified Intermediary (QI)

Once your contract is signed, it’s time to bring in your QI. A Qualified Intermediary like CPEC1031, LLC prepares the required IRS documentation, holds your sale proceeds in escrow, and structures the exchange for compliance. Without a QI, your exchange could be invalidated—so don’t go it alone.

3. Don’t Touch the Funds

At closing, your proceeds must be wired directly into the QI’s qualified escrow account. If you receive or even temporarily access the funds, the IRS considers it a taxable event. This rule is strict—so make sure your QI is ready ahead of time to receive the funds.

4. Know and Follow Your Deadlines

There are two big deadlines to keep in mind. You only have:

• 45 days in which to identify all replacement properties

• 180 days from the sale of your original property or your federal tax filing date, whichever comes sooner to close on the new property

Miss either of those deadlines, and your exchange could be disqualified. A good QI will help you stay on track and avoid common pitfalls.

Thinking About a 1031 Exchange?

A 1031 Exchange is a strategic way to preserve equity, defer taxes, and build long-term wealth—but only if it's done right. At CPEC1031, we guide investors through the process with clarity, speed, and full IRS compliance.

Have questions or want to explore whether a 1031 exchange is right for you? Reach out to Jeff Peterson today at jeffp@cpec1031.com or call 612-643-1031.

• 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.

© 2025 Copyright Jeffrey R. Peterson All Rights Reserved

Explaining the 1033 Replacement Period

If your property is seized, condemned, or destroyed, the IRS gives you time to reinvest and defer capital gains under section 1033 of the Internal Revenue Code. But the clock is ticking, and it’s important to understand when those time periods start and stop.

When Does the 1033 Replacement Period Begin?

Let’s start with the basics. What triggers the beginning of the 1033 replacement period?

It depends on the situation. If your property is subject to storm destruction or theft, then the replacement period would begin on the date of that event—the destruction or theft itself. But if the property is condemned or seized (or even just under threat of condemnation or seizure) the clock can start earlier. It could be:

• The date of the actual condemnation or seizure.

• The date the threat of seizure began.

• The date the property was sold under that threat.

Your replacement period begins whenever one of these occurs (whichever one comes first). 

In most situations, you will have two years to complete the 1033 transaction. However, if it’s business or investment real estate, and the conversion was due to condemnation or threat of it, you get three years instead.

Get Your Like-Kind Exchange Started Today

Get your 1031 exchange of investment real estate started today by contacting the team at CPEC1031, LLC. Our qualified intermediaries have decades of experience working on all kinds of 1031 and 1033 exchanges with clients throughout the United States. No matter where your property is located, we can help facilitate your like-kind exchange and make sure you defer 100% of your capital gains taxes on the sale. Contact our team today at our downtown Minneapolis office, where you can learn more about the benefits of 1031 exchange and see how we can help.

• 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.

© 2025 Copyright Jeffrey R. Peterson All Rights Reserved