1031 Exchange Navigator
Track your 1031 exchange deadlines, follow the step-by-step checklist, and calculate the tax you're deferring. Enter your sale close date to generate your critical deadlines.
Sale Close Date (Day 0)
Exchange Checklist
0/11 completeEngage a Qualified Intermediary (QI)
The QI must be in place BEFORE you close on the sale. You cannot touch the proceeds. The QI holds the funds in escrow throughout the exchange. Choose a QI that is bonded, insured, and uses segregated escrow accounts.
Notify your title company / closing agent
Inform the title company handling the sale that this is a 1031 exchange. They will coordinate with the QI to ensure proceeds are wired directly to the QI at closing, not to you.
Notify your CPA / tax advisor
Your CPA needs to know about the exchange to properly file IRS Form 8824. They can also advise on depreciation recapture, boot calculations, and structuring the exchange.
Close on the sale — proceeds go to the QI
This is Day 0. The 45-day and 180-day clocks start ticking. You must NOT receive or have access to the proceeds at any point. Direct all funds to the QI.
Identify replacement properties (by Day 45)
Submit written identification to your QI listing up to 3 replacement properties (the "Three-Property Rule"). Identification must include street addresses or legal descriptions. Alternative: identify any number of properties whose total value does not exceed 200% of the sale price (the "200% Rule").
Have your CPA review the identification letter
Ensure the identification is properly formatted, signed, and delivered to the QI before the 45-day deadline. Calendar day, not business day. No extensions for weekends or holidays.
Enter contract on replacement property
Negotiate and execute a purchase agreement on one of your identified replacement properties. The contract should reference the 1031 exchange and include a cooperation clause requiring the seller to accommodate the exchange structure.
Complete due diligence on replacement property
Inspection, appraisal, title search, and loan approval (if financing). Do not skip due diligence because of timeline pressure — a bad replacement property is worse than paying the tax.
Coordinate closing with QI (by Day 180)
The QI will wire the exchange funds to the title company to close the replacement property. You may add additional personal funds if the replacement property costs more than the sale proceeds.
Close on replacement property
Closing must occur on or before Day 180. There are no extensions. If Day 180 falls on a weekend or holiday, you must close before that date.
File IRS Form 8824 with your tax return
Your CPA will file Form 8824 (Like-Kind Exchanges) with your federal return for the tax year in which the exchange was initiated. Report both the relinquished and replacement properties.
Common Mistakes That Kill 1031 Exchanges
Touching the proceeds
If you receive or have control of the sale proceeds at any point — even briefly — the exchange is disqualified. All funds must go directly from the closing agent to the QI.
Missing the 45-day deadline
The identification deadline is absolute. If Day 45 falls on a Saturday, you must submit by Friday. No extensions, no exceptions. Submit early.
Using a related party as QI
Your attorney, CPA, real estate agent, or any relative cannot serve as the QI. The QI must be an independent third party.
Trading down in value
If the replacement property costs less than the sale price, the difference is "boot" and is taxable. To fully defer, the replacement must be equal or greater in value, and you must reinvest all proceeds.
Forgetting about boot from debt reduction
If you pay off a $200K mortgage on the relinquished property and only take on a $150K mortgage on the replacement, the $50K difference is mortgage boot — taxable. Match or exceed both price and debt.
Personal use of replacement property
The replacement property must be held for investment or business use. If you intend to live in it, you must hold it as a rental for at least 2 years before converting to personal use (Safe Harbor per Rev. Proc. 2008-16).
Tax Deferral Calculator
Estimate the federal tax you're deferring by completing this exchange.
Typical: $750–$1,500
This calculator estimates federal taxes only and assumes the maximum capital gains rate (20%) and NIIT (3.8%). Your actual rate depends on your total taxable income and filing status. State taxes are not included. Consult your CPA for personalized calculations.
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