Question

In order to do a 1031 exchange what must be done?

Answer 1

In order to do a 1031 exchange, you need to sell your investment property, identify a replacement property, close on the replacement property, and report the exchange on your tax return.

Step-by-step explanation:

In order to do a 1031 exchange, several steps must be followed:

1. Sell your investment property.
2. Identify a replacement property within 45 days of the sale.
3. Submit a written notice of your intent to perform a like-kind exchange to a qualified intermediary.
4. Close on the replacement property within 180 days of the sale.
5. Report the exchange on your tax return using IRS Form 8824.

It is important to consult with a tax professional or qualified intermediary to ensure compliance with all IRS regulations.