1031 Like-Kind Exchange
investmentAlso known as: 1031 exchange, like-kind exchange, Section 1031, Starker exchange
Updated · Written and reviewed by Konstantin Iakovlev
Detailed explanation
Two key deadlines: identify replacement property within 45 days of sale, and close within 180 days. Both calendar days, no extensions. A Qualified Intermediary must hold the proceeds — touching them yourself disqualifies the exchange. "Like-kind" is broad for real estate: rental house ↔ commercial building ↔ raw land ↔ partial interest in DST all qualify. Boot (cash received or debt relief) is taxable in the year of exchange. The deferral chains indefinitely — heirs can get stepped-up basis at death, eliminating the entire deferred gain. Periodically targeted for limitation but survived the 2017 TCJA and OBBBA.
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