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IRS Gives 1031 Buyers Reprieve on Deadlines
In an effort to relieve pressure on 1031 timelines, while much of the country is shut down and lenders are focused on processing loans initiated under the CARES Act, the IRS has temporarily altered the 45-day and 180-day requirements of 1031 exchanges.
If the 45-day deadline to identify a replacement property falls between April 1 and July 15, the new deadline is July 15. Likewise, if the 180-day purchase deadline falls between April 1 and July 15, the deadline is moved to July 15.
“The implications of the altered guidance will impact all stakeholders active in the 1031-exchange market, including a significant number of investors already on the upleg of a transaction,” reports Marcus & Millichap. “Shelter-in-place orders slowed the pace of closings, which could have left some investors responsible for capital gains taxes despite identifying a replacement property and attempting to purchase the asset within the allowable window.”
For comments, questions or concerns, please contact Paul Bubny
- ◦Financing
- ◦Sale/Acquisition
