LANCO TITLE AGENCY: 1031 TAX EXCHANGE
1031 exchanges are handled through our attorney, Jon Clark and an exchange is a swap of properties between two parties.
Most exchanges, whether they are simultaneous or delayed, involve three parties: the investor (exchanger) who is doing the exchange, the buyer who is purchasing the investor's old (relinquished) property, and the seller who is selling the investor a new (replacement) property.
To obtain the benefit of the "Safe Harbor" protections of the tax code to prevent actual or constructive receipt of the exchange proceeds, which would disqualify the exchange treatment, prudent investors use the services of a Qualified Intermediary. The Qualified Intermediary becomes a fourth party principal in both simultaneous and delayed exchanges.