During the course of a 1031 exchange, some taxpayers will identify multiple properties during their identification period, only to change their minds later on. The question then becomes – can you revoke property that you have already identified in a 1031 exchange? In this article, we are going to explain how to revoke identified property in a 1031 exchange transaction.
Revoking Identified Property
When you are within the confines of your identification period (the first 45 days of your exchange period), you can freely identify and revoke identification of as many properties as you wish. In order to revoke an identification, you need to provide to your intermediary a written revocation with your signature. This has to happen within the 45 day identification period in order for the revocation to be valid.
Once you have passed your 45 day identification period, you are no longer able to identify any additional properties or revoke identification of any properties you have already identified. This underlines the importance of preparation in a 1031 exchange. It’s always a good idea to get ahead of the 8 ball and start plotting out your exchange early on in the process to avoid any potential issues.
1031 Exchanges for All!
1031 exchanges are available to all United States taxpayers who wish to defer their capital gains tax when selling real estate. The qualified intermediaries at CPEC1031 have two decades of experience facilitating exchanges of real estate and helping taxpayers defer their capital gains taxes. Reach out to us to set up a time to chat with one of our 1031 exchange intermediaries about the specifics of your real estate exchange and start saving money today! Our primary office is located in downtown Minneapolis but we serve clients across 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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