All You Need to Know About Hiring a Qualified Intermediary for 1031 Exchange If you are planning to sell or purchase a property, chances are that you may be somewhat familiar with the 1031 exchange. Most of you may know under the IRS guidelines, section 1031 of the code enables you to defer taxes when you are purchasing a “like-kind” property or asset. Although it may seem an attractive and simple alternative, it requires a lot of deliberation on your part. So, to comply with the IRS guidelines and to ensure that the exchange is successful, you need to hire qualified intermediaries (QI) or 1031 advisors in Utah. Here are some of the things you should know before you hire a qualified intermediary for the 1031 exchange: ●
Purpose of hiring a Qualified Intermediary
To begin with, you need to understand the purpose of hiring a QI. Well, you need to hire a qualified advisor because it is mandated by the IRS guidelines. These professionals are responsible for ensuring that you perform your 1031 exchange successfully. Not only do they provide information to you about the standard time limits on the exchange, but they also assist you in other aspects of applying and qualifying for the 1031 exchange. ●
Eligibility to be a qualified intermediary
Next, you need to know about the eligibility of a qualified intermediary. As you may have guessed, you need to hire a designated professional who is qualified for the job. Please note that any of your immediate family members cannot be a QI in the 1031 exchange. This would include your parents, children, or siblings. Apart from this, you cannot seek 1031 intermediary services from any professional who can be seen as your “agent” in any respect. ●
Responsibilities of a QI
Once you are familiar with the basics, you need to know about the responsibilities of the QI or the 1031 advisors in Utah. In most cases, a QI is responsible for selling your property on your behalf and buying the replacement asset. After they do that, they are responsible for transferring the deed to you. In addition to these, they are also responsible for holding the proceeds and make sure that the 1031 exchange is performed as per the guidelines provided by the IRS.