1031 Exchange FAQ

A 1031 exchange (named after Section 1031 of the IRS Code) lets you sell an investment or business-use property and reinvest the proceeds into a like-kind replacement property while deferring federal capital gains tax.

For real estate, 'like-kind' is broad — virtually any U.S. investment or business real estate qualifies. You can exchange a rental home for another rental home, land, multifamily, or commercial property, and vice versa.

From the day your relinquished property closes, you have 45 calendar days to formally identify your replacement property (or properties) and a total of 180 calendar days to close on it. Both clocks run at the same time and cannot be extended.

Most investors use the '3-property rule' (identify up to three properties of any value) or the '200% rule' (identify any number of properties as long as their combined fair market value doesn't exceed 200% of the sold property's value).

Yes. The IRS requires that a Qualified Intermediary (QI) hold the sale proceeds between the sale of your relinquished property and the purchase of your replacement. You cannot take possession of the funds yourself. We can refer you to trusted QIs.

We recommend and work with Exeter Exchange Services.

Yes. Each home on this page is a stabilized, tenant-occupied single-family rental structured to serve as replacement property in a 1031 exchange. Reach out and we'll walk you through the identification and closing process.

Any difference in value or debt (called 'boot') is generally taxable. To fully defer capital gains, the replacement property should be of equal or greater value, and you must reinvest all of your net proceeds.