Question 1

Are 1031 exchanges state-specific?

Accepted Answer

Some states have additional 1031 exchange rules, however, Utah adheres strictly to federal 1031 guidelines, making it simpler for investors to navigate exchanges within the state.

Question 2

What is the 95% rule for 1031 exchanges?

Accepted Answer

The 95% rule allows investors to identify any number of potential replacement properties, provided they acquire at least 95% of the total fair market value of the identified properties. This rule gives flexibility in high-value markets like Utah.

Question 3

What is the 2 year rule for 1031 exchanges?

Accepted Answer

The "2-year rule" is an informal guideline suggesting that holding a property for at least two years helps demonstrate investment intent. Although the IRS does not mandate a holding period, this duration can help prove compliance with the "held for investment" requirement.

Question 4

What disqualifies a property from being used in a Utah 1031 exchange?

Accepted Answer

Properties held for personal use (such as a primary residence) or resale (e.g. fix-and-flip projects) do not qualify for a 1031 exchange. Additionally, failing to meet deadlines or to use a Qualified Intermediary can invalidate an otherwise eligible exchange.

1031 Exchanges in Utah

First American Exchange Experts in Utah

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