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1031 Exchanges Replacement Properties
More than one potential replacement property can be identified under one of the following three conditions:
The Three-Property Rule - Any three properties regardless of their market values.
The 200% Rule - Any number of properties as long as the aggregate fair market value of the replacement properties does not exceed 200% of the aggregate FMV of all of the exchanged properties as of the initial transfer date.
The 95% Rule - Any number of replacement properties if the fair market value of the properties actually received by the end of the exchange period is at least 95% of the aggregate FMV of all the potential replacement properties identified.
Although the Regulations only require written notification within 45 days, it is recommended practice for a solid contract to be in place by the end of the 45-day period. Otherwise, a taxpayer may find himself unable to close on any of the properties which are identified under the 45-day letter. After 45 days have expired, it is not possible to close on any other property, which was not identified in the 45-day letter. Failure to submit the 45-Day Letter causes the Exchange Agreement to terminate and the Intermediary will disburse all unused funds in his possession to the taxpayer.
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©2010 All States 1031 Exchange Facilitator,
LLC.
exchange@allstates1031.com :: Boston, MA &Providence, RI :: 1-877-395-1031
Please note that
not all states recognize tax deferred like kind 1031 exchanges. Foreign
investors in US real estate living outside the United States are subject
to securities and
tax regulations within their applicable jurisdictions
that are not addressed on this site. Contact your
local All States 1031
Exchange Facilitator, LLC office for information and availability. Whether
it is
1031 TIC Exchanges, TIC
1031 Brokers, TIC
Replacement Properties,
tenants in common or
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Exchange, we can help you.
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