How to Defer Capital Gains Taxes When You Sell Investment Property​

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Thinking about selling your rental or investment property? You might be able to defer capital gains taxes using a 1031 Exchange. Here’s what you need to know:

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What is a 1031 Exchange?

    A 1031 Exchange allows you to sell one investment property and reinvest the proceeds into another, without paying capital gains taxes right now. 

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Basic Requirements:

• Only applies to investment or business-use properties (not primary residences).

• Must purchase a “like-kind” property (any other investment real estate).

• You can’t receive the sale proceeds directly — they must go to a Qualified Intermediary (QI)

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Timeline:

• 45 days: You must identify up to 3 potential replacement properties.

• 180 days: You must close on one of those properties.

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You Cannot:

• Use the funds for a personal expenses.

• Exchange into a second home or primary residence.

• Miss the deadlines — there are no extensions.

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What You Need To Do:

1. Tell your Realtor that you want to do a 1031 Exchange.

2. Hire a Qualified Intermediary (QI) before closing.

3. Work closely with your Realtor to find and lock in a replacement property quickly.

4. Keep your CPA in the loop.

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Let’s make your investment work smarter — not harder. I’ll help you meet every deadline and connect you with trusted professionals to keep your exchange on track.