IRS has Granted Extensions for 1031 Exchanges

The IRS released Notice 2020-23 that provides numerous extensions to address taxpayer issues due to the outbreak of of the novel coronavirus (COVID-19) in Massachusetts and the United States. The IRS has issued extensions that relate to 1031 exchanges for real estate investments. The Notice extends any 45-day or 180-day deadline that occurs between April 1 and July 14, to July 15, 2020 for real estate and proceeds that part of a 1031 exchange.

Real Estate exchangers that benefit from an extension of the 45-day deadline are those entities or persons that closed, or will close, on their relinquished property between February 16th and May 31st. If the 45 day deadline expires within this time period, the deadline is extended to July 15, 2020. If the 180 day period is after July 15, 2020, then the exchanger must still close within 180 days.

Real Estate exchangers that will benefit from an extension of the 180-day deadline are those that closed on their relinquished property between October 4th, 2019 and January 17th, 2020. In this instance, the 180 day deadline has been extended to July 15, 2020.

Northshore Legal LLC specializes in real estate law, and represents buyer and sellers of residential and commercial real estate. We will continue to provide updates throughout the pandemic crisis. We can be reached at consultation@northshore.legal or 781-463-6063.