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Does the original property have to be sold prior to closing on a new like kind property in order to exercise the 1031 exchange? We have our vacation home for sale, however, we have selected a like kind property already and may have to close on the new property before we can sell the original property. Is there a grace period for this?

Submitted: 1781 days and 18 hours ago.
Category: Tax
Value: $10
Status: CLOSED

Accepted Answer

There are specific rules about the types of property that qualify for a 1031 exchange. The remainder of my answer is predicated on the assumption that this property qualifies.

It is possible to do a "reverse" exchange in this situation. This type of trade has been created to deal specifically with the conditions that you have described. You MUST use an intermediary and you MUST follow the rules for it to work. If you want to pursue this, you need to meet with a knowledgable qualified intermediary ASAP. 

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Expert: Jon Andrews
Pos. Feedback: 99.7 %
Accepts: 2879
Answered: 5/5/2005

Certified Public Accountant (CPA)

I deal with all levels of tax planning and controversy - from the ordinary to the complex.

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