The Parties and Properties in a 1031 Exchange There are four parties involved in a typical 1031 exchange: the Taxpayer or Exchangor, the Buyer of the Relinquished Property, the Qualified Intermediary and the Seller of the Replacement Property. The Taxpayer or Exchangor: owns an investment property and would like to exchange it for another investment …
Exchanges & Installment Sale Scenarios Taxpayer Able, who is a non-dealer in real estate, owns improved rental property with an adjusted cost basis of $100,000. Able has just received a bona fide offer to sell his property for $750,000. Pursuant to the terms of the offer, the buyer will pay Able cash in the amount …
Exchanges that start in one tax year and end in a subsequent tax year are sometimes called Year-End Exchanges. An exchange must be reported on the tax return for the year in which your relinquished property was sold; if the relinquished property in your exchange was sold in 2020, your exchange must be reported on …
You’ve just completed a §1031 exchange – you closed on a good replacement property (or two), used all the funds in your escrow account, and believe your capital gains taxes on the sale of your original investment property will now be fully deferred! You’re done, right? In fact, you’re almost done: all that’s left …
