IPX1031 Insight Blog

Reverse 1031 Solutions in a Challenging Market

Reverse 1031 Solutions

Rapidly rising interest rates have had an immediate impact regarding how transactions are financed and closed. Despite this challenging environment, investors are actively utilizing 1031 Exchanges to strategically structure their transactions to maximize tax deferral.


However, we’ve seen many investors set up a traditional “Forward” 1031 Exchange only to find that as the closing date approaches for their Relinquished Property, their buyer needs an extension of time. If the closing date for the property the seller intends to acquire cannot be extended, a Reverse Exchange may be the solution to preserve their 1031 Exchange. Parking the new target property with IPX1031 as the Exchange Accommodation Titleholder (EAT) ensures that the property will be available once the seller’s Relinquished Property closes.

What is a Reverse Exchange?

Simply stated, a Reverse Exchange allows an investor or company to acquire their Replacement Property before selling their Relinquished Property and still defer the taxes on the gain on their Relinquished Property.

Why are Reverse 1031 Exchanges More Complicated?

Reverse Exchanges Can Provide Additional Solutions to Defer Taxes:

  • Even More Time: If 180 days is not enough, additional time may be available through “non-safe harbor” Reverse Exchange.
  • Combo Exchange: If an investor intends to acquire multiple Replacement Properties with some properties closing before the Relinquished Property sale and some properties closing after, combining both the Forward and Reverse Exchange structures can maximize the tax deferral.
  • Improvement Exchange: By parking the Replacement Property, exchange funds can be used to improve the property prior to its acquisition by the investor.

Read More

Start a Reverse Exchange online
Reverse & Improvement brochure  
Reverse book
What is a Reverse Exchange?
Why are Reverse 1031 Exchanges More Complicated?

IPX1031 – Your Reverse 1031 Solution

IPX1031 is your Reverse 1031 solution with offices and teams across the country. Not only is IPX1031 the nation’s largest 1031 Qualified Intermediary, IPX1031 has a specialized division that focuses solely on structuring and facilitating Reverse and Improvement Exchanges. IPX1031 offers the highest levels of security and assurances in the industry for customers’ funds. Our team of professionals includes attorneys and Certified Exchange Specialists®. Contact IPX1031 to discuss all of your 1031 Exchange needs.

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