Delayed Exchange

About Delayed Exchange:

Delayed (tax-free) Exchange is a transaction in which a property is traded for the promise to provide a replacement like-kind property in the near future. The Tax Reform Act of 1984 allows investment property or productive property used in a trade or business to be sold with the tax on the gain deferred, provided that replacement property is identified within 45 days and closed within 180 days. The taxpayer may not receive cash and then use the cash to purchase the replacement property. Other strict requirements must also be observed. See also tax-free exchange. Former IRC (check if this IRC provision is current here) § 1031(a)(3).