1031 Exchange: Qualifications

What is a Qualified Intermediary?

A Qualified Intermediary enters into a written Exchange agreement with you. The entity is empowered to acquire and transfer the property you are selling to your buyer. The Qualified Intermediary is also charged with acquiring the replacement property from the seller and transferring it to you. The Exchange Agreement expressly limits your rights to receive money during the interim pursuant to IRS safe harbor regulations.

Let First American Exchange watch your step

  1. You realize that the intended sale of your investment properties will generate substantial capital gains taxes.
  2. Call First American Exchange to discuss your proposed exchange. We will provide the "Cooperation Clause" that reserves the right to enter your property into an exchange transaction when your Realtor® has one or more of your investment properties under contract.
  3. Secure First American Exchange as your Qualified Intermediary
  4. First American Exchange prepares documentation for review by your Legal or Tax advisor. Upon closing the relinquished property sale, First American Exchange will deposit the proceeds into safe, interest bearing accounts until the replacement investment(s) is free of contingencies.
  5. Within 45-days of the close of escrow on the sale of the relinquished property, the replacement property(ies) must be identified. Replacement property must be acquired on or before
    1. 180 days from the date of closing the transfer of the relinquished property, or
    2. the tax filing date for the taxable year in which the transfer of the relinquished property occurred, whichever is sooner.
    It is imperative that you file for all allowable tax filing extensions to ensure the availability of the 180-day period.
  6. First American will keep you informed throughout the process and provide you with a complete reconciliation of your exchange transaction upon completion.

For General Inquiries Please call 1 866 FIRSTNY (1.866.347.7869)