1031 Exchange Accomodators & Qualified Intermediaries
(QI)
The Role of Qualified Intermediary (QI) In
A 1031 "Like Kind" Exchange
Section 1031 of the Internal Revenue Code (IRC) offers
a great opportunity for real estate buyers to defer
the capital gains tax liability associated with the
sale of a business or investment asset. The 1031 exchange
ensures the maximum return on investments to people
of all financial backgrounds. To qualify for 1031 "like
kind" property exchange the entire transaction
has to be done in accordance to the detailed rules,
regulations and compliance issues set forth in the
US (IRS) tax code.
The (QI), also known as a facilitator
or exchange accommodator the Qualified Intermediary
(QI) serves a crucial function under the Internal
Revenue (IRS) Code. Choosing an Intermediary to facilitate
the 1031 exchange is usually the first and one of the
most important steps. The Qualified Intermediary (QI)
should be a company that works on a full-time business
of facilitating 1031 exchanges. The Internal Revenue
(IRS) Code requires that the person or entity serving
as (QI) cannot be someone with whom the exchanger has
had a former business or family relationship prior
to the transaction. The IRS code is clear in the fact
that a (QI) has to be an independent organization whose
only contact with the exchanger is to serve him as
a Qualified Intermediary (QI).
Forward Delayed Exchange
A type of exchange which occurs when a property is
sold "Relinquished Property" and another
property is purchased "Replacement Property" within
180 days following the sale of the Relinquished Property.
Relinquished Property
The original property being sold by the taxpayer when
making a 1031 exchange.
Replacement Property
Is the new property being acquired by the taxpayer
when making a 1031 exchange.
Reverse
Exchanges
This is the type of exchange in which the Replacement
Property is purchased before the sale of the Relinquished
Property. 
A 1031 tax deferred real estate exchange
accommodator
Reprinted
with permission
