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Services / 1031 Exchange

Defer the tax. Keep the equity.

A 1031 exchange lets you sell an investment property and reinvest the proceeds into a new one — deferring capital gains taxes entirely. I specialize in helping clients execute these across NJ and SC.

How It Works

The 1031 exchange, simplified.

Under IRS Section 1031, when you sell an investment property and reinvest the proceeds into a "like-kind" property, you can defer paying capital gains taxes. The key word is defer — you're not avoiding taxes, you're postponing them while your money stays working for you.

Day 0

Sell

Close on the sale of your current investment property. Proceeds go to a Qualified Intermediary (QI) — not you.

45 Days

Identify

You have 45 days from closing to identify up to 3 potential replacement properties. The clock starts immediately.

180 Days

Acquire

Close on your replacement property within 180 days of the original sale. The QI transfers the funds directly.

Tax Deferred

Defer

Capital gains taxes are deferred. Your full equity rolls into the new property. Rinse and repeat.

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The deadlines are strict.

45 days to identify. 180 days to close. Miss either deadline and the exchange fails — you owe taxes on the full gain. This is why having an agent who understands the process is critical.

Reverse 1031 Exchange

Buy first. Sell second.

Most people think you have to sell before you buy in a 1031 exchange. That's the traditional route — but it's not the only one. A reverse 1031 exchange lets you acquire the replacement property first, then sell your existing one after.

This is a game-changer when the perfect property hits the market and you can't afford to wait. Instead of losing the deal while you scramble to sell, you lock in the new property first and work backwards.

Reverse exchanges are more complex and less commonly used — which means most agents have never touched one. I have.

How a Reverse 1031 Works

The process flips the traditional order:

01

An Exchange Accommodation Titleholder (EAT) acquires and "parks" the replacement property on your behalf

02

You have 45 days to identify which property you'll sell (the relinquished property)

03

You sell your existing property within 180 days

04

The EAT transfers the replacement property to you, completing the exchange

When to use a reverse exchange

When you find the perfect replacement property and can't risk losing it while your current property sells. Common in competitive markets like the Grand Strand where good inventory moves fast.

Comparison

Forward vs. reverse 1031.

Forward (Traditional)

Reverse

Order of transactions

Sell first, then buy

Buy first, then sell

Best for

Sellers with time to find replacement

Buyers who found the perfect property

Identification period

45 days to ID replacement

45 days to ID property to sell

Completion deadline

180 days to close on new

180 days to sell existing

Complexity

Standard — widely used

Advanced — requires EAT

Cost

QI fees (~$750–$1,500)

Higher — EAT + holding costs

Risk

Finding replacement in time

Selling existing in time

Why Work With Me

Most agents can't do this.

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Licensed in Both Markets

I can sell your NJ investment property and find your SC replacement — or vice versa. One agent managing both sides of the exchange eliminates coordination risk.

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I Understand the Deadlines

45 days. 180 days. These aren't suggestions — they're hard IRS deadlines. I build the timeline backwards from day one so we're never scrambling.

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QI & CPA Coordination

I work directly with Qualified Intermediaries and your tax advisor to make sure the exchange is structured properly. This isn't DIY territory.

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Replacement Property Analysis

I don't just help you find a property — I run the numbers. Cap rates, rental projections, appreciation potential. Your replacement should outperform what you're leaving.

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Reverse Exchange Experience

Most agents have never even heard of a reverse 1031. I've worked them and understand the EAT structure, the parking arrangements, and the additional complexity involved.

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NJ → SC Exchange Specialist

The most common exchange I see: selling a NJ rental or investment property and exchanging into a SC beach property or STR. I've built my practice around this exact move.

Common Scenarios

Exchanges I see all the time.

NJ Rental → SC Beach Property

You own a rental in Bergen County that's appreciated significantly. Sell it, exchange the proceeds into an oceanfront condo or beach house in Myrtle Beach that generates STR income. Tax deferred, cash flow upgraded.

NJ Multi-Family → SC Portfolio

Exchange a NJ duplex or multi-family into multiple SC investment properties. Diversify your portfolio geographically while deferring a massive tax bill.

Reverse: Lock In SC First

The perfect SC property hits the market and won't last. Use a reverse 1031 to acquire it immediately through an EAT, then sell your NJ property within 180 days to complete the exchange.

Vacation Home Conversion

Convert a property you've used as a rental into a vacation home — or vice versa. The rules here are nuanced, but with proper planning and timing, a 1031 exchange can still apply.

FAQ

1031 questions, answered.

Can I exchange a primary residence?

No. 1031 exchanges only apply to investment or business-use properties. Your primary home doesn't qualify. However, if you've converted a property from personal use to rental, there may be options — talk to your CPA.

What qualifies as 'like-kind' property?

Broadly, any real estate held for investment can be exchanged for any other real estate held for investment. A NJ apartment building can be exchanged for a SC beach condo. The property types don't have to match — just the intent.

Do I need to reinvest 100% of the proceeds?

To fully defer taxes, yes — the replacement property must be of equal or greater value, and all proceeds must be reinvested. If you take cash out (called 'boot'), you'll owe taxes on that portion.

What's a Qualified Intermediary and do I need one?

A QI is a third party who holds the sale proceeds during the exchange period. They're legally required — you can never touch the money yourself or the exchange is disqualified. I work with experienced QIs and will connect you.

Can I do multiple exchanges over time?

Absolutely. There's no limit to how many 1031 exchanges you can do. Some investors chain exchanges over decades, continually deferring gains and growing their portfolio tax-free until they pass the property to heirs (who get a stepped-up basis).

How is a reverse 1031 different from a regular one?

In a reverse exchange, you buy the replacement property before selling your existing one. An Exchange Accommodation Titleholder (EAT) 'parks' the new property while you sell. Same deadlines (45/180 days), but more complex and more expensive. It's the right move when you can't risk losing the replacement property.

Disclaimer: I'm a real estate agent, not a tax advisor. The information on this page is for educational purposes. Always consult with a qualified CPA or tax attorney before executing a 1031 exchange.

Considering a 1031 exchange?

Let's talk through your situation — what you own, what you want, and whether a forward or reverse exchange makes sense. No pressure. Just strategy.