In early April, the IRS announced extensions for taxpayers who are currently involved in 1031 Exchanges. The notice states that if either or both the 45-day identification and 180-day exchange period deadlines fall between April 1 and July 15, all deadlines will have an automatic extension to July 15th. This is to help provide additional relief to those who are affected by COVID-19.
This relief notice follows the extension of filing federal tax returns and tax payments to July 15th. Unfortunately, those whose identification period occurred prior to April 1st will not be affected by the extension, but we will continue to keep you updated as the situation changes.
1031 like-kind Exchanges allow real estate investors to sell their asset(s), identify a similar property within 45 days of selling their original asset, and then closing on that similar property within 180 days.
Suzanne Goldstein Baker, the general counsel of Investment Property Exchange Services Inc. reminds us that, “if an investor now has until July 15 to identify the property, the original 180-day closing date would likely remain since it falls outside the affected date ranges.”
Similar extensions of 1031 Exchanges have been issued in the past due to the affected areas of natural disasters or emergencies.
With the ever-evolving economic landscape, it is easy to get lost in the confusion. Feel free to reach out to us with any questions or concerns you may have regarding your 1031 Exchange or opportunity zone investment.
Stay healthy,
Waterloo Realty
