1031 Exchange Qualified Intermediary Services

A qualified intermediary, or QI, is a neutral third party required under IRC Section 1031 to facilitate your exchange. The QI holds the proceeds from your sale in qualified escrow accounts , helps ensure funds are handled within IRS safe harbor regulations, and maintains the documentation needed to support the transaction. At JTC, our experienced team supports clients through each stage of the process.

JTC supports a wide range of exchanges, including forward exchanges, reverse exchanges, build-to-suit exchanges, and transactions involving partial interests such as Tenant-in-Common structures or Delaware Statutory Trusts. Our specialists tailor each solution to the client’s needs, including more complex property, timing and ownership scenarios.

In a forward 1031 exchange, you sell your relinquished property first, identify potential replacement property within 45 days, and complete the purchase of the replacement property within 180 days. In a reverse exchange, the replacement property is acquired first, and the relinquished property must be sold within 180 days, typically using an exchange accommodation titleholder to hold title during the process. Because reverse exchanges involve more complex structuring and documentation, experienced guidance is especially important.

Under current tax law, 1031 exchanges can be used to defer taxes on the exchange of  real estate held for business or investment purposes. For example, an office building may be exchanged for an apartment complex, or a shopping centre for raw land. The key requirement is that both the relinquished and replacement properties meet the IRS definition of like-kind real estate.

The IRS deadlines in a 1031 exchange are strict. If the taxpayer does not identify replacement property within 45 days, or does not complete the exchange within 180 days, the exchange generally fails and the sale may become taxable. JTC helps clients track these deadlines carefully and encourages building in extra time wherever possible to help avoid timing issues.

The same taxpayer rule generally requires the same taxpayer that transfers the relinquished property to also acquire the replacement property. This means the taxpayer on both sides of the exchange must match, whether the property is held by an individual or through an entity or trust. Because ownership and title issues can affect exchange eligibility, it is important to confirm the structure at the outset.

JTC uses segregated FDIC-insured accounts and does not commingle client funds with operating funds. We also use dual authorization for fund disbursements, maintain detailed transaction records, and provide real-time visibility through our platform, helping clients track activity with confidence.

Look for a provider with Certified Exchange Specialist credentials, secure and segregated account handling, real-time transaction tracking, relevant experience with your exchange type.. Because not all the intermediaries are created equal, expertise, transparency and trust should be central to your decision.