IRS Announces Extended Exchange Deadline for Investors
Written by Nathan Kuhn April 14, 2020
Real estate investors who are selling property using a 1031 exchange received some welcome news last week! The IRS has issued new guidance extending the 45-day and 180-day deadline requirements currently defined in IRC section 1031.
The notice stipulates that anyone with a 45-day identification period or 180-day closing deadline that occurs between April 1st and July 14th will have their deadline extended until July 15th.
A more detailed discussion on the new guidance can be found here. You can also view the IRS notice 2020-23 here.
Several industry groups had recently lobbied the IRS and Treasury to issue an extension. They believed the extra time would help investors struggling to find replacement properties to still close on their exchanges amidst the COVID-19 lockdowns, thereby preserving their potential tax deferral benefits.
The notice also extended the filing requirements for certain taxpayers and extended the time period until July 15, 2020 to make an election to invest capital gain into a qualified opportunity fund – if the original 180-day period expired on or after April 1, 2020 and before July 15 2020.
As always, if you are completing an exchange, you should speak with your tax advisors to determine if you are eligible for this extension.
Please contact us if you have any questions about the extended deadline requirements. We’re happy to provide more detail and discuss if this applies to your 1031 situation.
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Whether you're thinking about selling a property and want to better understand the 1031 exchange process and investment choices, or if you already sold your property and the proceeds are currently held at a Qualified Intermediary, we can help.
Please call us at (224) 245-5281 or schedule an introduction today.
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