Compliance Guide
Regulatory context, structural considerations, and coordination principles for 1031 exchanges.
This Compliance Guide is designed to provide high-level educational context around 1031 exchanges, replacement property structures, and advisor coordination. The information presented is intended to support informed discussion and planning — not to replace professional tax, legal, or investment advice.
Purpose of This Guide
1031 exchanges involve strict statutory timelines, documentation requirements, and coordination among multiple parties. Missteps can result in disqualification, unintended tax consequences, or compliance issues.
This guide outlines:
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The regulatory framework governing 1031 exchanges
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The roles and responsibilities of key participants
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Structural considerations relevant to replacement properties, including replacement property identification strategy and ownership eligibility
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Best practices for advisor-led coordination
Educational Use & Limitations
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i1031u.com provides educational information only
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Content is not an offer, solicitation, or recommendation
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No investment, tax, or legal advice is provided
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Information is presented at a general, institutional level
Investors should consult with their own CPA, attorney, and financial advisors before entering into any 1031 exchange or investment structure.
Accredited Investor Context
Certain replacement property structures discussed within i1031u.com — including Delaware Statutory Trusts (DSTs) — may be available only to accredited investors as defined under applicable securities laws.
This guide assumes a general familiarity with:
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Accredited investor standards
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Advisor-led planning frameworks
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Institutional real estate ownership concepts
Key Participants in a 1031 Exchange
A compliant 1031 exchange typically involves coordination among:
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Qualified Intermediary (QI)
Facilitates the exchange and holds proceeds in accordance with IRS requirements. -
Investor / Exchangor
The taxpayer completing the exchange. -
Tax Advisor (CPA)
Advises on tax implications, reporting, and eligibility. -
Legal Counsel
Reviews documentation, entity structures, and compliance considerations. -
Replacement Property Sponsors / Operators
Manage underlying real estate assets when applicable.
i1031u.com does not replace any of these roles and is designed to operate alongside them. under applicable securities laws.
Structural Considerations
When evaluating replacement strategies, investors and advisors should consider:
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Ownership structure and eligibility for 1031 treatment
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Timing alignment with identification and closing deadlines
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Passive vs. active ownership responsibilities
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Long-term planning and re-exchange flexibility
All structures must comply with IRS requirements and applicable securities regulations.
Ongoing Responsibility & Oversight
Completing an exchange does not eliminate the need for continued oversight. Investors should remain engaged with their advisors to monitor ongoing compliance requirements, reporting obligations, and
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Ongoing compliance requirements
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Reporting obligations
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Long-term planning opportunities
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Future exchange considerations