1031 Exchange Rules
1031 Exchange Rules
When choosing a replacement 1031 exchange
rental property for the 1031 exchange, the
property investor must follow one of the following 1031 exchange rules:
The Three-Rental Property Rule - No more than three rental properties regardless of their market values, may be chosen as potential replacement rental properties within 45 days of the close of escrow on the relinquished rental property. Said rental properties must be acquired within 180 days of the close of escrow on the relinquished rental property.
The 200% Rule - States that, in the event that three or more replacement rental properties are used, their total market value must not exceed 200% of the value of the rental property that is being relinquished.
The 95% Exception - Finally, in the case that rules 1 and 2 do not apply, the aggregate value of the like kind rental properties must account for at least 95% of the value of the rental property being sold in order for the exchange to qualify.
Contact us for more questions regarding 1031 exchanges and tenant in common exchanges and we will put you in contact with a specialist in your area.