Seller, “Exchanger”, must locate suitable like-kind property within 45 days of the close of transfer of exchange property in order to comply with the like kind exchange rules under 1031 (a) (3) (B). Also, Seller, “Exchanger”, must be aware that no more than 180 days from the date of the transfer of the property relinquished in the exchange, will be allowed for acquisition, or after the due date (including extensions) of the transferor’s tax return for the year in which the transfer occurred, whichever deadline occurs first. However, no more than 180 days will be allowed for the Seller, “Exchanger”, to acquire his or her acquisition property.
If the property you acquire within the 180 day period is not one of the properties that you identified within the first 45 days, your exchange will be in jeopardy of complete disallowance.
Identification for tax purposes must be made in writing which must be submitted to the Accommodator by mail or fax machine, on or before the 45th day.
In order to have a complete tax-deferred exchange, you must comply with the following:
1) Sale price of the acquisition or acquisitions of property or properties must be equal or more of the sale price of the sale property.
2) Mortgage or mortgages on acquisition or acquisitions of property or properties must be equal or more of the mortgage on the property given up.
3) No Notes or Trust Deeds should be carried back. (If a note is carried back, it must go into the name of the Accommodator until the transaction has been completed and then transferred back to taxpayer).
4) No cash should be taken out of the exchange funds.
If any one or all of the four above are not complied with, the difference is taxable.