What are the Do’s and Don’ts for 1031 exchange?

The essential key points one should keep in mind are:

• Advance Planning: To get success in 1031 exchange, advanced planning is required like attention must be given on the timing of the relinquished property, estimating the equities, debt replacement objective to avoid boot and a qualified intermediary.
• Remember the deadlines: The IRS allows exchanging the properties within the two timelines, i.e. 45 days of identification period, or the period of 180 days to get the replacement property.
• Do not change the property title during the exchange: Changing how title to your property is being held or dissolving partnerships during the exchange may cause the exchange to be dishonored due to holding- period issues.