1031 like-kind exchanges come in several different forms. One particular type is called the simultaneous exchange. In this article, we are going to talk about simultaneous 1031 exchanges – what they are and when they can be useful.
Simultaneous 1031 Exchanges
A simultaneous exchange is a concurrent 1031 exchange in which a taxpayer disposes of their relinquished property and immediately acquires the new replacement property. This is also commonly referred to as a drop and swap exchange.
However, most 1031 exchanges are not structured as simultaneous exchanges, but rather as delayed exchanges. This is simply because most taxpayers are not able to line up the selling of their relinquished property and the purchase of their replacement property. A delayed exchange allows you to sell your relinquished property, and then acquire your new replacement property at some point over the following 180 days (the first 45 of which are set aside for identification of the new replacement property). This gives taxpayers a lot more flexibility, which is why it’s the preferred method for exchanging real estate under section 1031.
1031 Exchange Accommodator
At Commercial Partners Exchange Company, our 1031 exchange accommodators have decades of experience helping taxpayers with their like-kind exchanges of real property. Whether you’re doing a forward exchange, a reverse exchange, or a build-to-suit construction exchange we have the knowledge and experience to walk you through the process and help you defer your capital gains taxes. With offices around the country, we facilitate 1031 exchanges across the United States. Contact us today at our Minneapolis office to set up an appointment with one of our qualified intermediaries.
- 1031 Hotline: If you have questions about simultaneous exchanges, feel free to call me at 612-643-1031.
Defer the tax. Maximize your gain.
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