There are a lot of confusing terms in the realm of 1031 exchanges. Two you may hear quite often are “Qualified Intermediary” and “Third Party Administrator.” In this article, we are going to discuss the distinction between these two common 1031 exchange terms.
Qualified Intermediary
A qualified intermediary is a like-kind exchange expert who assists taxpayers through the 1031 exchange process. Here are a few essential items that a qualified intermediary can help you with during the 1031 exchange process:
Document Preparation. There are numerous documents that need to be prepared in any 1031 exchange. Attention to detail is paramount on these documents as even a small error can jeopardize your exchange. Your intermediary can prepare all of these documents for you and make sure you’ve covered all your bases.
Replacement Property Identification. You need to properly identify your replacement property during the 1031 exchange process and your intermediary can help you do that appropriately.
Answering Questions. Any questions you have throughout the process can be answered by your intermediary.
Third-Party Administrator
A third-party administrator is basically just another term for a qualified intermediary. They mean essentially the same thing and can be used interchangeably. Whatever you call them – qualified intermediary or third-party administrator – it is important to work with one on your exchange.
Continued Real Estate Investment
With a 1031 exchange, you can defer your capital gains taxes on the sale of real estate and, ultimately, keep your hard-earned money working for you in a continued real estate investment. The first step is to work with a qualified intermediary who can walk you through the process, answer your questions, and advise you every step of the way. Contact our 1031 exchange intermediaries today to discuss the ins and outs of your exchange. Our office is located in downtown Minneapolis, but we work with 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.
© 2021 Copyright Jeffrey R. Peterson All Rights Reserved