1031 for installment contract?

[Adam Odom]

I am preparing a contract to sell a property right now and we are carrying the note. The buyer will more than likely do the owner financing for a couple of years then either pay off or finance into a traditional loan. My question is - can I still use that lump sum payment at that point down the line to do a 1031 exchange or does it have to be at the time of the purchase transaction? Secondary question to that - this is a commercial property but I mostly buy residential - if I was able to do the exchange could I buy a residential property since it's still going to be "investment" property or would it have to be another commercial property to satisfy the like kind requirement?

[Dave Foster]

@Adam Odom, sorry it's 180 days period.  If you don't put the note in the exchange it's taxable the second you accept it.  If you put it in the exchange but don't replace it before the 180 days then it is taxable at day 180 (the advantage to this  is that you would recognize the gain in 2018 rather than 2017 so tax wouldn't be due till 2019).  But if you exchange it during the 180 days then it is not taxable and you can complete a full 1031 exchange.