IRS Grants Extension for 1031 Exchange Deadlines
On April 9, 2020, the IRS issued Notice 2020-23 providing additional relief for taxpayers affected by the COVID-19 Pandemic. Taxpayers performing Section 1031 exchanges are included in the expanded relief as documented in the notice.
This Notice is very different from the typical disaster declaration and extensions granted in the past and is somewhat confusing based upon the way it was drafted. Historically, the President would declare a Natural Disaster for a specific geographic area and a date specific event, and the IRS would then issue a Disaster Relief Notice providing a 120-calendar day extension to the 45-day identification and 180-day deadline. The same extensions were not granted this time.
45 and 180 Calendar Day Deadlines Extended Due to Coronavirus (COVID-19)
45-day Identification:
If your identification date falls between April 1, 2020 and July 15, 2020 you have until July 15, 2020 to identify prospective replacement properties.
180-day Deadline:
If your 180-day deadline falls between April 1, 2020 and July 15, 2020 you have until July 15, 2020 to complete your exchange transaction.
These timeline extensions are for both forward and reverse exchanges alike.
For those who had a 45-day Identification or 180-day deadline prior to April 1st, we will keep you informed of additional guidance from IRS. We know that many regions of our nation had stay at home orders in place prior to April 1st which impacted the ability to perform on real estate transactions. The Federation of Exchange Accommodators (FEA) will be requesting additional relief for the taxpayers that need it and Premier 1031, Inc. will announce any new relief or clarifications provided by the IRS.
Business as usual, our office is doing our part to flatten the curve, we are focused on the health and safety of our clients and staff during this uncertain time. You can rest assured knowing that we are fully committed to delivering the outstanding services you’ve come to expect, and we truly are business as usual while continuing to work remotely.