We talk a lot about the timing requirements of a 1031 exchange, but many taxpayers are unaware of the specific timing rules that govern 1031 exchanges of real estate. In this article, we are going to talk about the timeline restrictions of a 1031 exchange – specifically whether or not you can conduct a 1031 exchange after you’ve sold your relinquished property.
Time Restrictions
The time restrictions you need to keep in the back of your head during any 1031 exchange are the 180 day exchange period and the 45 day identification period. The 180 day exchange period is the total time you have to complete your like-kind exchange – from the sale of your relinquished property to the purchase of your replacement property. The identification period consists of the first 45 days of the overarching exchange period.
Selling Your Relinquished Property
If you have already closed on the sale of your property you may have already received the sales proceeds and recognized gain on the sale. At this point, there’s not much that can be done, unfortunately.
Preparation is key in any 1031 exchange. Before you even think about selling your relinquished property you should consider your options and see if a 1031 exchange is right for you. Work with a qualified intermediary well before you are ready to sell your relinquished property so they can help you prepare accordingly and make sure all of your bases are covered.
Capital Gains Tax Deferral
CPEC1031 has twenty years of experience helping taxpayers in all sectors defer their capital gains taxes when selling real estate. If you have questions about 1031 exchanges or you’re interested in starting your own exchange, our intermediaries are on hand now to address all your concerns. Contact us today to speak with one of our team members about your real property exchange. We office in downtown Minneapolis but work with clients across Minnesota, as well as other states around the country.
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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