[ Home ]   1.800.TIC.1031   TAXFREEEXCHANGE1031.COM
 

1031 Exchange Properties
Largest selection of 1031-TIC Properties. Up-to-the-minute USA Database.
/landing/property

1031 Exchange Experts
Learn from the experts. Gain access to select TIC Properties Nationwide.
/landing/experts

1031 Exchange-REIT
Learn about 1031-REIT Exchanges. Exchange into a REIT 100% Tax Free!
/landing/REIT

1031 Oil and Gas
Increase Cash Flow, Decreased Risk, Inflation Hedge, Diversification.
/landing/oil_gas

1031 Exchange-TIC Info
Difficulty Finding NNN Property? Consider NNN Tenant in Common.
/landing/tic


Tax Free 1031 Exchange Rules

In order to comply with IRS internal revenue code, property owners must identify potential replacement rental properties withing 45 days of the close of escrow and acquire said rental property (or rental properties withing 180 days of the closing of the relinquished rental property. Furthermore, when entering into a tax free 1031 exchange, property owners must comply with one of the following rules:

  • The Three-Rental Property Rule - Dictates that the seller must identify up to a total of three potential replacement rental properties within the 180 day Acquisition Period.

  • The Two Hundred Percent Rule - This rule dictates that, if three or more replacement rental properties are chosen, their total aggregate value may not exceed 200% of the value of the acquired rental property at its time of selling.

  • The Ninety-five Percent Exception - Finally, in the event that rules 1 and 2 are null and void, rule 3 takes precedence. This rule states that, if three or more replacement rental properties are used in the transaction, their total market value must comprise at least 95% of the value of the rental property being relinquished.

    It is worthy to note that many tax free 1031 exchange property owners are drawn to tenants in common exchanges due to the pre-approved financing options available.