IRS Offers Relief For 1031 Exchanges

Treasury Notice 2020-23, released April 9, 2020 provides some relief to taxpayers engaged in like-kind exchanges.

 

The full notice is available here: https://www.irs.gov/pub/irs-drop/n-20-23.pdf

 

The Notice provides an extension to July 15, 2020 for taxpayers whose 45th day identification period or 180th day exchange period fall between April 1, 2020 and July 14, 2020.

 

Likewise, taxpayers engaged in reverse exchanges whose 45th day to identify relinquished property or 180th day to un-park replacement property fall between April 1, 2020 and July 14, 2020 are granted an extension to July 15, 2020.

 

Chicago Deferred Exchange has provided the following examples of how these extensions should work: 

 

Example 1: 

 

Taxpayer sells relinquished property on March 1, 2020.

Day 45 would normally be April 15, 2020.  That date is now pushed to July 15, 2020.

Day 180 is unchanged: August 28, 2020.

 

Example 2:  

 

Taxpayer parks replacement property on December 1, 2019

Day 45 is January 15, 2020.

Day 180 would normally be May 29, 2020.  That date is now pushed to July 15, 2020.