Sell Your Property: The first step is to sell your current investment property. The sale
proceeds are held by a qualified intermediary, who facilitates the exchange process.
Identify Replacement Property: Within 45 days of selling your property, you must identify
potential replacement properties that you intend to purchase. You can identify up to
three properties of any value, or more properties as long as their total value does not
exceed 200% of the value of the property sold.
Acquire Replacement Property: You must acquire the replacement property or
properties within 180 days of selling your property. The purchase price of the
replacement property must be equal to or greater than the net sale price of the
relinquished property.
Complete the Exchange: Once you acquire the replacement property, the exchange is
complete, and you can defer paying capital gains taxes until you sell the replacement
property in a future 1031 Exchange or a taxable sale.