Am I Ready for a 1031 Exchange?

Assess your readiness and get a personalized action plan for your 1031 exchange

Answer 20 questions across 4 categories to assess your readiness and get a personalized action plan.

Timeline Readiness

1. How soon are you planning to sell your property?*

Understanding your timeline helps determine urgency of preparation steps.

2. Have you started looking at replacement properties?*

The 45-day identification period starts at closing of your sold property.

3. Do you have financing lined up for your replacement property?*

Securing financing can take 2-4 weeks and is critical for meeting the 180-day deadline.

4. How familiar are you with coordinating a 1031 exchange closing?*

Team Readiness

5. Do you have a Qualified Intermediary (QI) selected?*

A QI must be in place BEFORE you close on your sold property. This is non-negotiable.

6. Have you consulted with a CPA or tax advisor about your exchange?*

Tax planning is critical for understanding boot, depreciation recapture, and basis calculations.

7. Do you have a real estate attorney available for the transaction?*

While not always required, an attorney can help navigate complex situations and contract reviews.

8. Do you have a broker engaged for finding replacement properties?*

A broker experienced with 1031 exchanges can help you meet tight deadlines and identify suitable properties.

9. Is your title company experienced with 1031 exchanges?*

The title company coordinates with your QI and must understand 1031 exchange requirements.

Financial Readiness

10. Do you know the cost basis of your current property?*

Cost basis = original purchase price + capital improvements - depreciation taken.

11. Have you calculated your potential capital gain?*

Your gain = sale price - cost basis - selling expenses. This determines your deferral amount.

12. Do you understand your replacement property requirements?*

To fully defer taxes: Buy equal or greater value AND replace all debt OR add cash.

Equal or greater value requirementEqual or greater debt requirement45-day identification ruleNot sure about the requirements

13. Do you understand what 'boot' means in a 1031 exchange?*

Boot is taxable cash or debt relief received. It triggers partial taxation.

14. Do you have reserve funds available for closing costs and contingencies?*

You may need cash for earnest money, inspections, closing costs beyond exchange proceeds.

Knowledge Readiness

15. Do you understand the 1031 exchange deadlines?*

These are calendar days (not business days) and are strictly enforced by IRS.

45-day identification deadline180-day purchase completion deadlineNot sure about the deadlines

16. Do you understand what qualifies as 'like-kind' property?*

For real estate, 'like-kind' is broad: most real estate qualifies regardless of type.

17. Are you familiar with the identification rules?*

You can identify: up to 3 properties (any value), OR unlimited properties up to 200% of sold value, OR 95% rule.

18. Do you understand the related party transaction rules?*

Special rules apply when buying from or selling to family members, entities you control, etc.

19. Do you know who can and cannot serve as your Qualified Intermediary?*

Your agent, broker, attorney, or accountant who worked for you in the prior 2 years cannot be your QI.

20. Do you understand what happens to personal property in the sale?*

Furniture, equipment, and other personal property don't qualify for 1031 exchange.

Please answer all 20 questions to see your results

Ready to Get Started?

Connect with professionals who can help you execute your 1031 exchange successfully