reverse exchange

reverse exchange

A tax-deferred exchange in which the taxpayer acquires the replacement property before selling the relinquished property. See 1031 exchange. (It is far more common to sell a property and then begin looking for a replacement property to take advantage of Section 1031 of the Internal Revenue Code.)

References in periodicals archive ?
However, it is important to close the transaction on the relinquished property prior to purchasing the replacement property in order to avoid a reverse exchange parking arrangement situation.
The reverse exchange allowed him to invest in a new property before closing on the related sale.
The sale of this property involved a specialty asset type and a reverse exchange, which required a depth of experience in RV storage properties, resources, and the industry contacts of their team and all parties involved.
The trust purchased the condominium for $1.6 million in December 2013 from Reverse Exchange LLC, led by Craig and Elizabeth Stephens Campbell.
(In a parking transaction, replacement property is "parked" with an exchange facilitator that holds title to the replacement property, usually until improvements to the property are completed to allow for an exchange "solely for property of like kind.") Thus, the decision could be good news for taxpayers who wish to build or modify replacement property in a reverse exchange, as it is typically difficult to complete property construction within the 180-day safe-harbor time frame.
In a reverse exchange, the taxpayer receives the replacement property before the transfer of the relinquished property.
One method to alleviate the risk is to achieve a safe harbor by following Revenue Procedure 2000-37 and enter into a reverse exchange. (11)
State Department, in partnership with the private sector, will launch the YLAI Professional Fellows Reverse Exchange Program to implement collaborative community projects and strengthen partnerships between companies and organizations in the U.S.
In a reverse exchange, replacement property is purchased before the sale of relinquished property.
As one of the BSP's open market operations to influence liquidity, FX swaps are transactions involving the "actual exchange of two currencies on a specific date at a rate agreed on the deal date and a reverse exchange of the same two currencies at a date further in the future at a rate agreed on deal date."
A "reverse exchange" is permissible under additional "safe harbor" rules that lay out time frames similar to the 45- and 180-day rules for delayed exchanges.