When our clients consider selling a business or investment real estate and want to buy more, Section 1031 can enable them to defer capital gains and depreciation recapture taxes on the transaction. Using a Qualified Intermediary, such as JTC, converts the sale and the purchase into an exchange and creates the opportunity for tax deferral.
As a trusted partner, we help our clients take the important step of selecting the best Qualified Intermediary for 1031 Exchanges.
At JTC, we have established an industry-leading track record as a 1031 Qualified Intermediary, with more than 30 years’ experience and tens of thousands of successful 1031 exchange transactions.
This is due, in part, to our in-house expertise. Members of our legal and client services team have decades of experience handling 1031 exchanges.
Our client services team is also supported by our award-winning, cloud-based platform, eSTAC®, which we built from the ground up to maximize transaction security and transparency.
“There are a lot of ways a 1031 exchange can go wrong, which is why it is important to work with an experienced team. JTC has built its reputation through decades of successful transactions so you can feel confident you are working with a team that has expertise in all manner of exchange scenarios.”
What We Do
Why Choose JTC
Extensive 1031 Experience and Expertise
Our legal and client services teams’ experience in accounting, banking and technology sets us apart. We can handle large and complicated exchange scenarios that many Qualified Intermediaries cannot.
When an exchange is conducted with JTC, clients get 24/7 access to our online 1031 Portal, which displays up-to-date exchange status and provides a comprehensive audit trail.
Industry-Leading Security and Safeguards
We were the first to implement the 1031 security measures that are now industry standard, such as:
- Exchange funds are only held in FDIC-insured, fully liquid accounts at highly rated banks
- Professional Indemnity Insurance and cyber insurance
- Exchange funds are placed in individual qualified escrow accounts
- Exchange funds are never commingled in operating accounts
- Funds are released from escrow only with approval of both the Qualified Intermediary and the exchanger
- Award-Winning eSTAC® Platform
- 24/7 Access to Exchange Information
- Dual-Authorization Disbursements of Funds
- Funds Held in Segregated and Insured Accounts
- Automated Document Management
- Dedicated Client Services Team
Types of Exchanges
1031 Forward Exchanges
This solution enables clients to defer capital gains and depreciation recapture taxes when they sell a business or investment property and buy like-kind property with an equal or greater value. In a forward exchange, it is sell first, then buy.
1031 Reverse Exchanges
A reverse exchange gives the exchanger the flexibility to acquire the replacement property first and sell the relinquished property later, providing additional flexibility. This is done utilizing a “parking arrangement” whereby the accommodator holds the replacement property until the relinquished property can be sold.
Delaware Statutory Trusts
Delaware Statutory Trusts (DSTs) provide an alternative source of replacement property for 1031 exchangers, utilizing special provisions of Delaware trust law to create the investment vehicle. Exchangers who purchase units in a properly structured DST are treated as having acquired their proportionate interest in the trust-owned real estate. DSTs offer the advantages of professional real estate management and portfolio diversification alongside the potential for a monthly income stream.
Washington state law, RCW 19.310.040, requires an exchange facilitator to either maintain a fidelity bond in an amount of not less than one million dollars that protects clients against losses caused by criminal acts of the exchange facilitator, or to hold all client funds in a qualified escrow account or qualified trust that requires your consent for withdrawals. All exchange funds must be deposited in a separately identified account using your taxpayer identification number. You must receive written notification of how your exchange funds have been deposited. Your exchange facilitator is required to provide you with written directions of how to independently verify the deposit of the exchange funds. Exchange facilitation services are not regulated by any agency of the state of Washington or of the United States government. It is your responsibility to determine that your exchange funds will be held in a safe manner.