A 1033 exchange due to Fire of a 1031 Exchanged Property.

[Buddy Holmes]

I have/had a SFR in SC, which was an exchange property in a CA 1031. We had a severe fire with an estimated 6 to 9 months to rebuild.

We opted to use the insurance payoff to payoff the mortgage (BTW this is much more complex than you might imagine) and sell the home AS IS to a Flipper.  I can do a 1031 on the Flip sale (then the tax reporting seems difficult) but the 1033 exchange rules seem like the more flexible way to go.  However I have not found any written rules like in the case of the 1031 exchange.

That is:

1) Does the new property have to be >= t the net sale of the Flip Sale plus Insurance like a 1031?

2) Does the new mortgage have to be >= the old mortgage like a 1031?

3) I understand there is no requirement for a QI to handle funds.

4) I understand the time lines are more relaxed and 2 years in mentioned but no real rule.

5) I see talk about identifying the exchange property on a tax return but again no rule or how to do this.

I would appreciate any help on this issue and thanks for @Dave Foster for heads up to the 1033 in the first place.

Cheers,

Buddy