1031 Tax Deferred Exchange Deadlines

Need to quickly understand how the 45 calendar day identification period and the 180 calendar day exchange deadline works with the 1031 Tax Deferred Exchange? Welcome to the next episode of Exeter Tax Deferred Solutions' White Board Videos, which will help you learn the 1031 Exchange basics quickly. View the entire series of The Exeter Edge White Board Videos.

Bill Exeter interviewed on 1031 Exchanges

Bill Exeter was interviewed on The American Dream TV Show by host Craig Sewing. Mr. Exeter provides viewers with a quick overview on 1031 Tax Deferred Exchange transactions, including a discussion of what a 1031 Exchange is, what the deadlines and timelines are, what qualified use and like-kind properties mean in the context of a 1031 Exchange, and more.



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Can I Change the Property that I have Identified in My 1031 Exchange

The 1031 exchange requires that you sell an exchange property (relinquished property) and acquire other property (replacement property in order to defer the payment of your capital gain taxes.

Replacement Property Identification
The 1031 exchange process requires that you identify the replacement property or properties that yu are going to acquire as your replacement property within your 1031 exchange. The identification must be made within 45 days from the date that you sold and closed on the sale of your exchange or relinquished property.

Changing Identified Property
The question that comes up all the time is can I change the replacement properties that I have already identified as part of my 1031 exchange. The answer is: It depends.

You can change your mind and revoke your identified properties at any time as long as you are still within your 45 calendar day identification period. Simply contact your 1031 exchange Qualified Intermediary and find out how they want you to revoke the identification that you already provided them with. I would recommend that you make a complete revocation of your previous identification even if you do not want to revoke all of the properties and then make a completely new identification on a separate identication form. This keeps the entire process nice and clean.

However, you can not change your mind and revoke your replacement property identification if you are outside of your 45 day identification period. You can only change your mind during the 45 day ID period, but not after the 45 ID period has past.

Beware of Changing Your Mind After the 45 Day Period
There are those 1031 exchange Qualified Intermediaries that allow you to amend, alter or change your identification period after the 45 day period. I get the comment all the time: It doesn't matter; THEY let me do it. Actually, they are allowing YOU to commit TAX FRAUD. I know that it is tempting, but it is tax fraud none the less.