1031 Exchange Specialists,

A National Qualified Intermediary

Inc.  [1031 ESI]

Corporate Headquarters:
1155 Asbury Avenue
Ocean City
New Jersey 08226

Ocean City, NJ: 609-398-1031

Naples, FL: 877-513-1031

   Fax: 609-398-0500

Web: www.1031esi.com
Email: info@1031esi.com

Business Hours:
Mon-Fri: 8:30-4:30

Independently Owned and Operated
Your Tax Savings is Our Business! 

History of Exchanges

The non-recognition of gain or loss on the exchange of property was first introduced in 1921, some three years after the imposition of income taxes, on the basis of continuity of investment or liquidity, and administrative convenience.  The early exchanges were direct simultaneous exchanges between two and three property owners.

In 1979, the famous Starker case became the legal basis for the non-simultaneous exchange.

In 1984, Congress established time limits for a non-simultaneous exchange, requiring the Exchangor to identify replacement properties within 45 days and settlement on the replacement property(s) within 180 days following the date the first property relinquished.  The ineligibility of exchanging partnership interests was also introduced in the 1984 amendments.

In 1989, new rules for exchanges between related persons were added.

In 1991, the IRS issued regulations addressing the role of the Qualified Intermediary, safe harbor rules, assignments of contracts, security of exchange funds, identification requirements, treatment of interest and disqualified parties.

In 1997, the Internal Revenue Code provided that personal property used predominantly within the United States was not "like kind" to the personal property used predominantly outside the United States.

In 2000, the IRS issued Revenue Procedure 2000-37 providing safe harbors for reverse parking arrangements.

In 2005, the I.R.S. issued Revenue Procedures 2005-7 and 2005-14 clarifying the exclusion of tax on properties used both for business/investment use and as a principal residence, thus combining the tax savings of Sections 1031 and 121.

In 2008, the I.R.S. issued Revenue Procedure 2008-16 providing safe harbor guidelines for 1031 exchanges of vacation homes.

Among the many modifications to the Internal Revenue Code under The Tax Cuts and Jobs Act, H.R. 1 (2017), 1031 exchanges are limited to real property held in the productive use in a trade or business or for investment.  Personal property, such as furniture, fixtures and equipment, will not be afforded 1031 exchange deferment after January 1, 2018.