1031 Exchange Process
Investors unfamiliar with 1031 Exchange rules can sometimes get intimidated by the requirements and process. That’s where we come in. We guide investors through selecting the DST investment that is best for their portfolio as well as help them through the 1031 Exchange process.
-
Decide to Exchange
Set up exchange account with a Qualified Intermediary (QI), also known as an exchange accommodator. If you don’t already have a QI, we’ll refer you to one. The QI must open a 1031 Exchange account BEFORE the close of escrow on the property being sold. -
Sell the Relinquished Property
Once you sell the relinquished property, at the close of escrow, your QI will coordinate with the escrow company to obtain all necessary signatures on the exchange documents. The QI handles all sale proceeds, which is a requirement of the 1031 Exchange process. -
Identify & Submit Your Replacement Property
The IRS requires that you identify potential replacement property(ies) within 45 days from the date the relinquished property was transferred. Your QI will help you submit the identified properties in writing on a form provided with the exchange documentation. The DST investment you’re interested in will be one of the properties identified. -
Close on Your Replacement Property
The acquisition of the replacement property must be completed within 180 days from the day the relinquished property was transferred. Your QI will work with the replacement property escrow company to obtain all appropriate signatures for the exchange documentation and forward the funds for closing. Depending on the nature of the transaction, additional steps may be required.
