For a 1031 Exchange, be it a straight 1031 or a 1031 Tenant in Common Exchange, IRS dates need to be observed.
Not only for strict tax purposes, but for practical reasons as well.
Once paperwork is filed with a Qualified Intermediary prior to close of escrow that a 1031 exchange will be made, one has 45 days from the date of close to identify property(s) that one intends to purchase.
If there was some way to "fudge" this deadline (please don't ask me how because it is definitely nothing I advocate and would definitely advise strongly against) here is what could happen.
Besides having your exchange disqualified (if the IRS found out somehow you didn't follow their rules) you run the additional risk of having your 180 day close of exchange sale deadline missed.
If you do not complete your exchange within 180 calendar days from date of property close, you will pay capital gains tax - no questions asked.
This seems like plenty of time, right? It usually is. Fluke twists of fate do happen. Financing falls through, mistakes are made through no fault of yours, and the consequences are ugly.
Moral: Stick to the rules. They are there for a reason. Bad things might happen if you think you can "beat the system"
Paula Straub
(760)917-0858
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