It is really an additional and separate process where your qualified intermediary forms a holding entity called the "exchange accommodating title holder" and takes title to the new property and holds it for you until your old property sells.More complex, More expensive, and the financing of the new property can be tricky. 

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I would recommend that you identify a qualified intermediary for the exchange and ask a lot of questions. 

They are simply wishing to document the exchange on the settlement statement and have a qualified intermediary hold their proceeds while they find and purchase their replacement property.  

It costs a bit of money to set up a 1031 exchange with intermediary etc so doubt that you’d come ahead by much in doing a 1031 for such a small gain, since your tax would be $1500 or less in best case scenario ($10k gain)

@Robert Duffer i assume you used an intermediary when you sold and they are holding the funds for you?

Hi @Lauren Hogan, The Qualified Intermediary has a critical fiduciary responsibility. 

I wanted to use my funds from my SEP IRA which is currently in a qualified intermediary trust.

@Jesus Ramirez Unfortunately the qualified intermediary who handles the 1031 must be in place prior to the closing of the sale.  

Also, they have someone on staff that will be an intermediary and email as well as call to coordinate repairs and rent collections -- another thing I believe no one else offers -- most just have auto emails sent out when rent is late.