If the investor wants to reinvest the property for the benefit of tax deferment and wants to do the 1031 Exchange, then you can get connected with us i.e., 1031exchangesponsor.com. We at 1031exchangesponsors have a team of experts to help you to complete your 1031 exchange in the best way. So, before processing for 1031 Exchange, you should have a brief knowledge of the 1031 Exchange and who are the experts?
Who are the experts?
The experts also are known as Qualified Intermediary (QI) plays a significant role in 1031 exchange, as he handles all the mandatory mechanics of a 1031 Exchange for an investor. Here an exchange must be facilitated by an independent third-party under the US Treasury Regulation 1031. Sometime Qualified Intermediary is also referred to as Facilitator or Accommodator.
It is essential to have an exchange agreement and use a QI so that the IRS does not consider a taxpayer to have taken a constructive receipt of the proceeds from a sale. When the deal is closed, the proceeds of the sale will directly go to the QI, not to the taxpayer. The Qualified Intermediary holds the proceeds until they are needed to acquire the replacement property or properties, at which time the QI will send the funds directly to the closing agent who deeds the property to the exchanger. The proceeds received from the sale of the relinquished property are kept in a particular type of account known as an escrow account.
If the Qualified Intermediary is not involved in the exchange then the investor will not be able to complete the exchange and he will be disqualified from the exchange. When you complete the transaction there is a lot of stake in it’s as this transaction includes your hard-earned money plus it includes the regulations involved in deferring the tax gains, so it is very important to choose the right Qualified Intermediary.
Getting familier with 1031 Exchange in brief
1031 exchange emerged from section 1031 of the IRC (Internal Revenue Code). This is an excellent rule used for deferring the capital gain taxes. In the 1031 exchange process, the investors sell the property and reinvest the proceeds to buy new replacement property, and defer all the capital gain taxes within 180 days of the sale of the property. The qualified intermediary also known as 1031 accommodator is involved in the exchange process without whose presence the exchange cannot be completed because the money received from the sale of the relinquished property is kept in the escrow account and if the investor touches the cash, then he/she is disqualified from the 1031 exchange.
All the information provided above has been researched and thought to be knowledgeable for you. After long research and analysis review, we are here to help you with the best real estate properties.
For consultation and assistance regarding 1031 Exchanges, you can call 888-993-2835 or email us at firstname.lastname@example.org