When is a failed exchange taxable...?

A common question we get this time of year involves what happens when a 1031 exchange falls in two tax years.

For example, you sell your old property in 2009, but your exchange fails and you get your money back in 2010 - when is your exchange taxable: 2009 or 2010?

The answer is, whichever year you WANT it to be.

The article in our archive titled, What to do when a 1031 exchange overlaps years explains how it works. Please feel free to print it, download it, forward it to your client, attorney, CPA or tax-preparer if this might help you or your client's tax situation.

And as always, please feel free to call us if you have any questions about this particular situation.

The 1031 Experts

Add new comment

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
  • Allowed HTML tags: <a> <em> <strong> <p> <br>
Please prove you're not a bot.
Enter the characters shown in the image.