It's easy to initiate a 1031 exchange when you have already selected your intermediary/facilitator. This is the all-important first step in going through this process. Before selecting someone to serve as your qualified intermediary, ask questions about the procedures they use and how a 1031 evolves under their guidance. You also want to identify the type of help they provide in the event that an obstacle emerges in your 1031 exchange. It might be a good idea to request any documents the facilitator might use so that you can have your attorney review them. You're ideally looking for someone who has a great deal of experience in working as a qualified intermediary.
Once you have selected the person you want to work with, starting a 1031 is as simple as reaching out with a phone call. It's helpful to have some of your information lined up in advance of this call related to the parties involved in the transaction. Examples might include names, addresses, file numbers, and contact information. During this initial phone call, your qualified intermediary will probably ask questions about the type of property being exchanged and what replacement property you plan to use, too.
While there is not a great deal of information that needs to be provided during this initial phone call, it can be comforting to work with someone who employs an in-depth process to ensure that you have all the right details on hand. Taking a proactive position in a 1031 exchange can be a very valuable characteristic to find in your qualified intermediary.
When you feel like you are ready to initiate a 1031 exchange, it's very important to be aware of timelines as they are quite strict. Once the relinquished property has closed, you have only 45 days to propose replacement property. Also from the date of closing, you have a total of 180 days in order to actually acquire the replacement property. Usually, the investor will nominate up to three possible replacement properties within the 45 day window, choosing to move forward with one of them.
If you plan to nominate more than three potential replacement properties, it's a good idea to work directly with your qualified intermediary. This individual can be a critical source of information that helps you move the transaction forward significantly, so rely on him or her as needed at the outset and during the entire process. This is why it's so important to choose the right person to serve as your qualified intermediary.
Once you have selected the person you want to work with, starting a 1031 is as simple as reaching out with a phone call. It's helpful to have some of your information lined up in advance of this call related to the parties involved in the transaction. Examples might include names, addresses, file numbers, and contact information. During this initial phone call, your qualified intermediary will probably ask questions about the type of property being exchanged and what replacement property you plan to use, too.
While there is not a great deal of information that needs to be provided during this initial phone call, it can be comforting to work with someone who employs an in-depth process to ensure that you have all the right details on hand. Taking a proactive position in a 1031 exchange can be a very valuable characteristic to find in your qualified intermediary.
When you feel like you are ready to initiate a 1031 exchange, it's very important to be aware of timelines as they are quite strict. Once the relinquished property has closed, you have only 45 days to propose replacement property. Also from the date of closing, you have a total of 180 days in order to actually acquire the replacement property. Usually, the investor will nominate up to three possible replacement properties within the 45 day window, choosing to move forward with one of them.
If you plan to nominate more than three potential replacement properties, it's a good idea to work directly with your qualified intermediary. This individual can be a critical source of information that helps you move the transaction forward significantly, so rely on him or her as needed at the outset and during the entire process. This is why it's so important to choose the right person to serve as your qualified intermediary.
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