1031 Frequently Asked Questions

1031 FREQUENTLY ASKED QUESTIONS

Since 1991, Exchange Authority has been the Authority on IRC §1031 Exchanges. Our exchange experts understand all the complexities and requirments that accompany every type of exchange and are willing to answer any question you may have. To assist you with learning more about the 'ins and outs' of exchanges, we have compiled the questions we are most often asked. To find answers to your questions either select a category or enter a search phrase.

If you do not find what you are looking for, contact us and we will respond promptly to assist you in your exchange, send you additional materials, or answer any question.

FAQs

Exchange Agreements : « Search Again

What is an Exchange Agreement?

What is an Exchange Agreement?

Answer:

A required document of an Exchange.

The exchange agreement is a required document of an exchange. It is usually an agreement to exchange like kind property made between a qualified exchange intermediary and the taxpayer. It must be in writing and executed by both parties.

The exchange agreement requires that the intermediary must acquire the relinquished property from the taxpayer, transfer it to the buyer, then acquire the replacement property from the seller and transfer it to the taxpayer.

The agreement must expressly limit the taxpayers right or ability to receive, pledge, borrow or otherwise obtain benefits of money or other property held by the intermediary before the end of the exchange period excepting, if the taxpayer has not identified replacement property prior to the termination of the identification period then the taxpayer may have such rights any time after the termination of the identification period, or after the time the taxpayer has received all of the identified property or all replacement property to which the taxpayer is entitled under the agreement, or after the termination of the exchange period or after the end of the identification period if there is an occurrence of a material and substantial contingency which prohibits the exchange and the contingency has been provided for in writing in the agreement and its occurrence is beyond the control of the taxpayer or any disqualified person.