Do I need a 1031 Exchange Agent?

One thing that people often make the mistake of when they are doing a 1031 exchange is that they think they do not need somebody independent to act as their exchange agent. But the IRS guidelines say one needs to have an exchange agent, called a qualified intermediary, who is independent, but what does this condition mean practically? It means that there is a whole list of people who cannot help one with his or her 1031 exchange. One’s realtor cannot act as his or her exchange agent, an attorney is unable to do it as well if he or she is representing one in the transaction. You cannot have your accountant do it. Really, you need to have somebody who is independent and qualified in order to act as your 1031 exchange agent.

What does an exchange agent do for you and your transaction?

Well, what an exchange agent does is make sure that one has an exchange agreement, that it complies with the IRS guidelines, that money is handled correctly during the course of the transaction, and that clear instructions are given to the title company and to everybody else involved in the transaction about the fact that one is doing a 1031 exchange. These steps are to ensure that one’s exchange lines up with the way the IRS wants it done. So again, one cannot just use somebody who is already involved in his or her transaction as an exchange agent. Hiring an exchange agent or qualified intermediary is essential. And they must be independent.

How We Can Help

If we can help you with a 1031 exchange, including as a qualified intermediary, or if you have questions, check out our website at, take a look at the videos on the WealthBuilder 1031 Exchange YouTube channel, or give us a call at 888-508-1901 and we would be happy to help you.