There are many things to remember when you’re engaging in a reverse 1031 exchange. Here are a few identification rules to keep in mind when you’re doing a reverse 1031 exchange.
Reverse 1031 Exchange Identification Rules
In a reverse exchange, the exchangor must designate the relinquished property within 45 days after the date when the new replacement property is parked with the Exchange Accommodation Titleholder (“EAT”). Here are some important identification rules in a Back-Leg Reverse Exchange where the new replacement property is parked with the Exchange Accommodation titleholder (“EAT”):
Close within 45 days of sale. Any relinquished properties disposed of within the first 45 days after the EAT takes ownership in the replacement property will be deemed to have been identified.
Designate any number of relinquished properties that in total are not more than 200% of the value of the new replacement property that is parked with the EAT.
Contact a Qualified Intermediary
These are just a few of the most basic identification rules in a reverse 1031 exchange. It’s always a good idea to speak with a 1031 exchange qualified intermediary about your exchange to ensure a successful process.
Start Your 1031 Exchange: If you have questions about 1031 exchanges, feel free to call me at 612-643-1031.
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