1031 Exchanges

A 1031 exchange defers capital gains tax by rolling proceeds from a relinquished property into like-kind replacement property — but the institutional execution is anything but mechanical. The 45-day identification window and 180-day closing clock are unforgiving, the three identification rules constrain how aggressive a sponsor can be on substitution, and boot received in cash or debt relief is taxable in the year of exchange. Basis carries over into the replacement asset, which compresses depreciation cover and seeds a larger deferred gain at eventual sale. When timing breaks, sponsors turn to reverse exchanges and EAT parking arrangements; when a 1031 investor cannot identify suitable property, DSTs offer passive replacement at the cost of sponsor fees and operational restrictions; and the 721 UPREIT exit converts an operating-asset basis into REIT OP units, swapping direct ownership for liquidity-restricted public-market exposure.

These five articles walk the 1031 stack from the basic exchange through the institutional alternatives. Start with 1031 Exchange Mechanics if you are orienting on the timing rules. Boot, Basis Carryover, and Deferred Gain is the modeling workhorse. Reverse 1031 covers the parking structure when replacement closes first. DST and 721 UPREIT are the two institutional-grade pass-through alternatives — each with different liquidity, fee, and tax profiles.