There are several ways of approaching property identification in a reverse exchange of real estate. In this article, we are going to discuss the two most commonly utilized identification rules in a reverse 1031 exchange.
Reverse Exchange Identification Rules
Here are the two most frequently used identification methods when dealing with a reverse 1031 exchange:
Three Property Rule: List three or fewer relinquished properties.
200% Rule: List any number of properties but the total aggregate value of all the identified relinquished properties cannot exceed 200% of the value of the replacement property.
Either of these identification rules will work in a reverse 1031 exchange. It’s just important that you abide by one of them in order to ensure the success of your like-kind exchange.
CPEC1031, LLC
If you are looking to start a reverse exchange of real estate, you’ve come to the right place. At CPEC1031, LLC we have decades of experience working with clients on reverse exchanges. Let us put our experience to work on your next like-kind exchange. Contact us today at our Minneapolis office to learn more. We work with clients throughout the state of Minnesota and across the United States.
Start Your 1031 Exchange: If you have questions about 1031 exchanges, feel free to call me at 612-643-1031.
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