Finding a Qualified Intermediary for your 1031 Exchange by Christopher Sanz, JD, LLM

Posted on November 04, 2021

Qualified intermediaries (QIs) are vital to the success of tax-deferred 1031 exchanges of real property. It is the QI’s responsibility to facilitate the exchange and ensure investors meet all the rules and timelines required for preferential tax treatment. This includes the requirement to identify like-kind replacement property within 45 days following a property sale and to close on the purchase of that replacement property within 180 days of the original sale. The QI receives and holds the net proceeds from the relinquished property and invests it into a new property without triggering any tax implications to the investor/taxpayer.

While their roles are critical to 1031 exchanges, QIs are not regulated by any federal agency nor are they required to by licensed or insured. Therefore, investors must tread careful when selecting a QI. Working with professional real estate advisors can help to ensure the QI you select has the experience and qualification to properly execute all phases on the exchange and make the process as smooth as possible.

With offices in Miami, Orlando, New York City and Geneva, the team at Orion works with investors, developers, property owners and brokers through all phases of real estate transactions, from strategic planning and analysis to financing, negotiation, property management and disposition. For more information, call (305) 278-8400 or email info@orionmiami.com.