What is a Safe Harbor Reverse 1031 Tax Exchange?
A Safe Harbor Reverse 1031Tax Exchange involves the accommodator temporarily holding the new property for the exchanger until the old property is sold. Within 45 days of this arrangement, the exchanger must identify this new property as being the replacement 1031 Tax Exchange property. The exchanger also has 180 days to complete the 1031 Tax Exchange transaction in order for it to be regarded as safe harbor. This safe harbor method of structuring a Reverse 1031 Tax Exchange is outlined in the 2000 IRS guidelines. This is viewed as the safest way to structure a Reverse 1031 Tax Exchange because it is clear that the exchanger does not receive any property prior to completing the transaction. What is a Traditional Reverse 1031 Tax Exchange? A traditional Reverse 1031 Tax Exchange is structured the same way as a safe harbor Reverse 1031 Tax Exchange except that the exchanger cannot meet the 180 day time requirement. This is usually due to the exchanger having difficulty selling their old p
