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1031 Exchanges

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Avery Goodman
  • Tallahassee, FL
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Tax implications of failed 1031

Avery Goodman
  • Tallahassee, FL
Posted Apr 10 2018, 07:49

I initiated a 1031 on October 18, 2017 (a flip I owned for 4 months), and now realize it may fail.  However, I've already filed a 2017 return.  Will the sale be recognized by the IRS as a short-term capital gain in 2017, or will it automatically be considered an installment sale because the 1031 won't officially fail until April 16, 2018?  Could I possible end up owing interest on top of the cap gain?

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