All Forum Posts by: Account Closed

To confirm, he's already sold the property and the funds are being held in escrow by a qualified intermediary? He has 45 calendar days from closing the sale to identify replacement property--how much time does he have left?

You might want to reach out to @Mark_Creason on here, who I think does lending in that space.

It might still be hard to defend a 1031 exchange here. If all indications were that this property was a flip, then selling based on an unsolicited offer is still consistent with a resell purpose. It'd be worth seeing what a CPA is comfortable giving a thumbs up to.

Given that you said you purchased the property recently and rehabbed it, you should definitely consult with a CPA if you want to go the 1031 exchange route. You don't want the exchange to be disallowed because it looks like flipping, e.g., in your loan or other documentation, which would make the it ineligible for an exchange. At the same time, it also sounds like you've used it as a rental business for a year or so, so your CPA may give you the thumbs up to proceed.

If your plan is to roll the capital gains over into a new investment property, you likely qualify to do a 1031 exchange (assuming you bought the property as an investment, not for resell).  Your CPA, broker, or lawyer can walk you through whether you qualify or it makes sense for your goals.  If it does, you'll have 45 days after closing the sale to identify replacement property options, and then you have 180 after closing the sale to close on the purchase.