1031 Exchange Basics for Orange County Property Owners
A 1031 exchange allows investment property owners to defer capital gains tax by reinvesting proceeds into a like-kind property. Here’s a general overview — always confirm specifics with a qualified intermediary and tax advisor.
Key deadlines
Exchangers generally must identify replacement property within 45 days of closing the sale, and complete the purchase within 180 days — these deadlines are strict.
Qualified intermediary requirement
Proceeds from the sale must be held by a qualified intermediary rather than passing through the seller’s hands directly to preserve tax-deferred status.
Why Orange County investors use 1031s
Given significant appreciation in many OC investment properties, exchanging into new property is a common strategy to defer gains while continuing to build a real estate portfolio.