Delayed 1031 Exchange Services
The most popular exchange type, accounting for 95% of all 1031 exchanges. Sell your investment property first, then purchase your replacement within 180 days.
Why Choose a Delayed Exchange?
Time to Find the Right Property
With 45 days to identify and 180 days to close, you have time to find the perfect replacement property without rushing into a poor investment decision.
Straightforward Process
The most common and well-understood exchange type. Real estate professionals, lenders, and title companies are familiar with the process.
Maximum Tax Deferral
Defer 100% of capital gains taxes, depreciation recapture, and state taxes. Keep all your equity working for you in your next investment.
How Delayed Exchanges Work
List and Sell Your Property
Before closing, engage National 1031 Center as your Qualified Intermediary. We'll prepare all necessary exchange documents and coordinate with your closing agent.
Critical: You must have exchange documents in place before closing. Contact us as soon as you have an accepted offer.
Funds Held by QI
At closing, proceeds go directly to National 1031 Center. We hold your funds in segregated, FDIC-insured accounts. We are bonded and insured for your protection. You never touch the money.
45-Day Identification Period
You have exactly 45 calendar days from closing to identify potential replacement properties. Most investors use the 3-property rule for maximum flexibility.
- Identify up to 3 properties of any value
- Must be in writing to your QI
- Include complete property addresses
180-Day Purchase Period
Complete your purchase within 180 days of selling. We'll work with your closing agent to ensure smooth fund transfers and proper documentation.
Exchange Complete
Congratulations! You've successfully deferred your taxes. We'll provide all documentation needed for your tax returns, including Form 8824.
Critical Timeline
Sale Closes
Clock starts
ID Deadline
Must identify
Purchase Deadline
Must close
Identification Rules
- • 3-Property Rule (most common)
- • 200% Rule (unlimited properties)
- • 95% Rule (must purchase 95%)
No Extensions!
These deadlines are statutory and cannot be extended for any reason, including weekends, holidays, or natural disasters.
Requirements for Success
To Defer All Taxes
- Equal or Greater Value: Purchase price must equal or exceed sale price
- Equal or Greater Debt: New loan must equal or exceed paid-off loan
- Use All Proceeds: All exchange funds must go into replacement
Property Requirements
- Investment Use: Both properties must be for investment or business
- Like-Kind: Any real property for any real property
- Title Consistency: Same taxpayer must sell and buy
Perfect for These Scenarios
Portfolio Consolidation
Selling multiple smaller properties to purchase one larger property for easier management and better economies of scale.
Geographic Relocation
Moving investments from one market to another, whether for better returns, tax advantages, or personal relocation.
Property Type Change
Transitioning from residential to commercial, raw land to developed property, or active to passive investments.
Estate Planning
Consolidating properties or moving to easier-to-manage investments like DSTs to simplify estate administration.
Value Optimization
Selling properties at market peaks and reinvesting in undervalued markets or property types with better growth potential.
Retirement Strategy
Moving from high-maintenance properties to triple-net lease or other passive investments requiring minimal management.
Delayed Exchange FAQs
What if I find my replacement property before selling?
Consider a reverse exchange instead. This allows you to purchase first and sell later, perfect for competitive markets or unique opportunities.
Can I identify more than 3 properties?
Yes, using the 200% rule (total value can't exceed 200% of sale price) or the 95% rule (must purchase 95% of identified value). The 3-property rule is simplest and most flexible.
What happens to my earnest money deposit?
Any earnest money you pay must come from your personal funds, not exchange funds. If a purchase falls through, the refund must go to your QI, not directly to you.
Can I take some cash out?
Yes, but any cash received (called "boot") is taxable. You can do a partial exchange, deferring taxes on the reinvested portion while paying taxes on the cash taken out.
Ready to Start Your Delayed Exchange?
Join thousands of investors who've successfully deferred taxes with our expert guidance.
Our Delayed Exchange Services Include:
Questions? Call our experts at (877) 483-0427