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1031 Exchange Requirements


1031 Exchange Requirement

Four requirements for all 1031 exchanges and tic-1031 exchanges:

  • One hundred percent of the value of the relinquished income real estate must be reinvested in the like kind income real estate or income real estate at the time of the exchange.

  • The amount of equity held in the relinquished income real estate must be less than the amount of equity held in the new, replacement income real estate or income real estate.

  • Each exchange, including tic-1031 exchanges, requires the use of a Qualified Intermediary to hold all proceeds of the transaction, prepare any paperwork, and answer any technical questions involved with the exchange.

  • Finally, a 1031 exchange is defined as the exchange of any like kind income real estate or income real estate for another like kind replacement income real estate or income real estate. As such, all income real estate involved in the exchange must be qualified like kind income real estate in order to incur the benefits involved with any 1031 tic-1031 exchange.
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