Steps for a Successful 1031 Tax-Deferred Real Estate Exchange

  • STEP 1: Before you close, PIONEER 1031 COMPANY WILL NEED A COPY OF YOUR SALES CONTRACT BETWEEN THE SELLER (EXCHANGOR) AND THE BUYER ALONG WITH A COPY OF THE PRELIMINARY TITLE REPORT. As with any sale of real property, you need to have a written contact between the parties involved. Further it is imperative to make sure that your Sales Contract is “assignable for the purposes of the 1031”. (We have recommended sample language available that can be included in the Contract, which also addresses the assignment issue). Once you have a sales contract, your realtor will open escrow with a title and escrow company of your choice. Pioneer 1031 Company will then prepare your 1031 Exchange documents and have them ready and waiting at the title or escrow company when you arrive for your closing. You can, of course, review the documents ahead of time.

    Once you have a sales contract, your realtor will open escrow with a title and escrow company of your choice. Pioneer 1031 Company will then prepare your 1031 Exchange documents and have them ready and waiting at the title or escrow company when you arrive for your closing. You can, of course, review the documents ahead of time.

  • STEP 2: MAKE AN APPOINTMENT WITH YOUR ESCROW OFFICER FOR THE SIGNING OF YOUR ESCROW DOCUMENTS. We will instruct your escrow officer on how to complete this "Phase I" of your tax-deferred exchange. She or he will forward your exchange funds directly to Pioneer 1031 Company upon the recording of the warranty deed. Pioneer 1031 Company will invest your funds in an interest-bearing account at a federally insured financial institution.

  • STEP 3: COMPLETE YOUR IDENTIFICATION NOTICE AND DELIVER TO PIONEER 1031 COMPANY. The day your warranty deed records is the day your 45-day identification period and your 180-day exchange period begins. You can identify your replacement property or properties in writing anytime up to midnight on your 45th day. Make sure Pioneer 1031 Company receives it by mail, by fax or by delivery before or on your deadline! No exceptions! (ID notice can be emailed.)

  • STEP 4: PIONEER 1031 COMPANY WILL NEED A COPY OF YOUR “ASSIGNABLE” REPLACEMENT PROPERTY PURCHASE CONTRACT AND PRELIMINARY TITLE REPORT. You must complete this “Phase II” of your exchange anytime before midnight of your 180-day exchange period deadline. Through your closing agent, we will disburse your exchange proceeds for your purchase. (We have recommended sample language available that can be included in the Contract, which also addresses the assignment issue.)

Now that you have purchased your replacement property and have used all of your tax-deferred exchange proceeds, you have successfully completed your tax-deferred exchange. Pioneer 1031 Company will then send you a final Exchange Settlement Statement and a check for the interest that you've earned while your exchange proceeds were being held. This is a simplified version of the tax-deferred real estate exchange process. Every tax-deferred real estate exchange may vary due to particular circumstances.

 

Copyright © 2005 - 2017 Pioneer Holding, Inc. All rights reserved. Please visit our terms of use page for more information.
Utilizing valid XHTML and CSS markup. Site design by Pomni Media.