To establish the intent to perform a Section 1031
tax deferred exchange, add the following 1031 assignment language to the Purchase and Sale Agreement. It is not required when selling, but when buying, the language must appear in the contract or
addendum given the rights of the contract are assigned to the Intermediary at the closing.
Sale of Relinquished Property:
"Buyer is aware that Seller has the option to qualify this transaction as an Internal Revenue Code Section 1031 tax deferred exchange. Seller requests Buyer's cooperation in the event of an exchange and agrees to the assignment of this contract to Atlas 1031 Exchange, LLC by the Seller. Seller agrees to hold the Buyer harmless from any and all claims, liabilities and costs of such an exchange.
Purchase of Replacement Property:
"Seller is aware that Buyer has the option to qualify this
transaction as an Internal Revenue Code Section 1031 tax deferred exchange. Buyer requests Seller's cooperation in the event of an exchange and agrees to the assignment of this contract to Atlas 1031 Exchange, LLC by the Buyer. Buyer agrees to hold the Seller harmless from any and all claims, liabilities and costs of such an exchange."
To learn more,
Ask The 1031 Expert,
Contact Us, call us and sign up for our newsletter
Exchange Tips and Information. Register for
Twitter, Facebook or
LinkedIn to receive IRS updates on 45 and 180 day extensions and pertinent court rulings.