How a 1031 exchange works for Utah real estate
By Joshua Sterling, REALTOR®, RE/MAX Associates · October 27, 2026
A 1031 exchange lets an investor sell business or investment real estate and buy other like-kind real estate while deferring tax on the gain, as long as strict rules are followed. Two deadlines drive everything: 45 days to identify replacement property in writing and 180 days to close on it, both counted from the day the property you're selling transfers. In Utah, that means planning the sale and the replacement search together, with a qualified intermediary in place before your sale closes.
Who's on your exchange team?
- Qualified intermediary (QI). Holds the sale proceeds and prepares the exchange documents. You can't take the money yourself.
- CPA or tax attorney. Advises on eligibility and tax treatment.
- Lender. If you're financing the replacement property.
- Title and escrow. Handles closing on both the sale and the purchase.
- Your real estate agent. Prices and sells your property, finds and negotiates replacement property, and keeps contract dates aligned with the exchange deadlines.
What are the 45-day and 180-day deadlines?
- Identification period: ends at midnight on day 45 after the transfer of the property you're selling.
- Exchange period: ends at midnight on day 180, or on your tax return due date (including extensions) for the year of the sale, whichever comes first.
- Both are calendar days, weekends and holidays included.
- If you sell several properties on different dates, both clocks start at the earliest sale.
Want a quick estimate? Try the 1031 exchange deadline calculator.
How do you identify replacement property?
- In a written, signed document delivered before the end of day 45 to your qualified intermediary (or another party to the exchange who isn't a disqualified person).
- Describe each property clearly, by street address or legal description.
- Three-property rule: up to three properties of any value.
- 200% rule: any number of properties, as long as their total value doesn't exceed 200% of what you sold.
- A narrow 95% exception also exists.
- You can revoke an identification only in writing, before day 45 ends.
What counts as like-kind real estate?
For real property, the category is broad. Investment or business real estate can generally be exchanged for other investment or business real estate, for example a rental home for land or a small commercial building.
- Since 2018, only real property qualifies.
- A primary residence and property held mainly to resell (like a flip) generally don't qualify.
Confirm your situation with your tax adviser.
Selling in California and buying in Utah?
California requires a yearly Form FTB 3840 filing when California property is exchanged for property in another state, until the deferred gain is taxed. Ask your CPA how it applies to you.
Where does Joshua fit?
Joshua handles the real estate side only: pricing and selling your property, finding and negotiating replacement property, and keeping contract dates in step with your exchange team. Your qualified intermediary and tax adviser handle the exchange itself.
Frequently Asked
1031 exchange questions
No. Your qualified intermediary handles the exchange documents and holds the sale proceeds, and your CPA or tax attorney advises on eligibility and taxes. Joshua handles the real estate side: pricing and selling your property, finding and negotiating replacement property, and keeping contract dates in step with your exchange deadlines.
Yes, under the 200% rule, as long as their combined value doesn't exceed twice the value of what you sold. There's also a narrow 95% exception. Most investors use the three-property rule. Your qualified intermediary can confirm what fits your exchange.
Generally the exchange fails and the sale is treated as taxable. Weekends and holidays don't extend the deadline. Limited postponements can apply in federally declared disasters, so talk to your qualified intermediary and CPA right away.
Generally yes; U.S. real estate in different states can be like-kind. If you sold California property, California requires a yearly Form FTB 3840 filing, so loop in your CPA.
No. Both deadlines count calendar days, including weekends and holidays.
Next Step
Book a 15-minute call with Joshua
Talk through your timeline and how the sale and purchase fit together before you list.
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Joshua Sterling is a REALTOR® with RE/MAX Associates. He handles the real estate side of your exchange and is not a CPA, attorney, investment adviser or qualified intermediary. Confirm exchange eligibility, deadlines and tax treatment with your qualified intermediary and tax adviser.