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Updated over 3 years ago on . Most recent reply presented by

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Michael Rutkowski
  • Specialist
  • Bozeman, MT
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What are people paying in fees for a 1031 exchange?

Michael Rutkowski
  • Specialist
  • Bozeman, MT
Posted

I'm trying to initiate a 1031 with a qualified intermediary, and have been quoted up to $3k for fees. Previously we were involved with one in a different state and they were only about $1k, but this was a few years ago. What are equity exchangers charging these days where you are from? Can I use any intermediary anywhere in the country, or do I need to use the ones in my state where my property is? I'm also looking to keep this between LLC's, and couldn't seem to get a sufficient answer from the lawyer I talked with. So I want to sell property from one LLC, and then buy a different property under a different LLC. Both are owned by me. Is the IRS going to allow that?

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Dave Foster
  • Qualified Intermediary for 1031 Exchanges
  • St. Petersburg, FL
9,448
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Dave Foster
  • Qualified Intermediary for 1031 Exchanges
  • St. Petersburg, FL
Replied

@Michael Rutkowski, Your idea of selling from one LLC owned by you and purchasing from another LLC also owned by you is a non-starter. The IRS is going to see that as you buying from yourself unless you own 50% or less of one of those LLCs.

You can use any intermediary as long as they have a national footprint.  1031 is a federal statute so it's form is the same nationwide.  QIs need to have the technological reach and available customer service to handle non-face to face closings.  I'd say that probably 50% of our closings start in one state and end in another anyway.  So location of your QI is not important.  Service is.

Here's an article we update periodically on costs nationwide for a 1031 exchange - https://www.biggerpockets.com/...

  • Dave Foster
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The 1031 Investor
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