The linear timeline of a standard 1031 exchange consists of a total of 180 days from the sale of your relinquished property to the acquisition of your replacement property. Running concurrently with that 180 day exchange period is your 45 day identification period. The first forty-five days of your exchange period are the time in which you must identify in writing your replacement property.
Right now, we’re in somewhat of a hot seller’s market. There’s an ongoing problem of inventory being thin. If you want something good, you’re competing against a lot of other bidders. 45 days is not a lot of time to find and identify suitable replacement property in a hot market. There’s a lot that goes into the process of purchasing your investment real estate. You may need to negotiate a deal, get a survey, review leases, have an inspection done, and more.
Savvy real estate investors try to lock in a sure thing even before they sell the relinquished property so they’re not hampered by this short 45 day identification period. This simply illustrates the importance of being prepared and giving yourself enough time to tackle your exchange before you begin the process by selling your relinquished property.
Build Your Wealth with a Like-Kind Exchange
Build your wealth by deferring capital gains taxes on the sale of investment real estate under section 1031 of the Internal Revenue Code. This tax-advantageous tool can help you defer a hefty capital gains tax bill and keep your hard-earned money working for you in a continued replacement property investment. Get to know the ins and outs of section 1031 by reaching out to a qualified intermediary at CPEC1031, LLC today. Our like-kind exchange professionals are ready and waiting to assist you through all the details of your next 1031 exchange.
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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