How to Fill Out and Submit a 1031 Exchange Identification Form

A 1031 exchange identification form is the signed written document you send to your Qualified Intermediary (or another eligible party) naming the replacement properties you plan to buy after selling investment real estate in a tax-deferred exchange. You have 45 calendar days from the transfer of the property you sold to get it signed and delivered, and the description of each property has to be unambiguous enough that anyone reading the form can tell exactly what you mean. Miss the deadline, botch the description, or violate the identification rule you chose, and the entire exchange collapses into a taxable sale.

What to Gather Before You Fill It Out

Section 1031 applies only to real property held for business use or investment, not to a personal residence or to personal property like equipment or vehicles.¹ U.S. real property and foreign real property are not like-kind to each other, so if the property you sold was domestic, every replacement property you list must be in the United States.

For each property you plan to identify, pull together:

The full street address, including city, state, ZIP, and any unit number.
The legal description from the deed or the county assessor’s parcel number, for vacant land or anything without a standard address.
An estimated fair market value. You need this if you use the 200% rule or the 95% rule, and it helps your intermediary check compliance even under the three-property rule.
The percentage of ownership interest you will acquire, if it is less than 100%.

Your Qualified Intermediary will usually hand you a blank template with your exchange order number, the sold property’s address, and the sale date already filled in. If you are working without a QI template, you can draft the document yourself. The regulations require only a signed written document that unambiguously describes the replacement properties, not any particular form.

Pick an Identification Rule First

The regulations give you three ways to stay within the identification limits. You pick one, indicate it on the form, and then everything you list has to fit within that rule. Choosing incorrectly, or listing properties that quietly violate the rule you picked, voids your entire identification as though you never submitted anything.

Three-Property Rule

You can name up to three replacement properties regardless of their combined value.² This is the most common choice because it needs no appraisals and lets you list backup options in case your first-choice deal falls apart. You do not have to buy all three. Closing on even one of the identified properties satisfies the exchange, provided you close within the exchange period.

200% Rule

If you want to identify more than three properties, the combined fair market value of everything on your list cannot exceed 200% of the value of the property you sold.² Sold for $500,000? You can list four, five, or ten properties as long as they add up to no more than $1,000,000. Your value estimates have to be realistic at the time you sign, because going over the cap by any amount voids the identification.

95% Rule

When neither of the first two rules works, usually in large commercial deals involving many parcels, the 95% rule is the fallback. You can identify any number of properties at any combined value, but you must actually acquire at least 95% of the aggregate fair market value of everything on the list by the end of the exchange period.² Falling short by any margin invalidates the entire identification. The rule is risky for most investors and generally suits coordinated portfolio acquisitions where every deal is essentially locked in before identification.

Filling Out the Form

Most QI templates run one or two pages. The layout varies, but every compliant form covers the same core fields drawn from the regulation.

Your full legal name (or entity name) as it appears on the exchange agreement.
The exchange order number assigned by your Qualified Intermediary.
The address or description of the property you already sold.
Which identification rule you are using: three-property, 200%, or 95%.
A description of each replacement property. Use the street address with city, state, and unit number where one exists; otherwise use the legal description from the deed or the county’s parcel number. The regulation requires the description to be “unambiguous,” and a legal description, street address, or distinguishable name all qualify.²
Fair market value for each property, if you are using the 200% or 95% rule. Many QI forms include a value field even under the three-property rule.
Ownership percentage, if you are buying a partial interest.
Your signature and the date. The regulation specifically requires the taxpayer’s signature.²

If the replacement property will be built or improved during the exchange period, include as much construction detail as you can at the time of filing. The regulations require detail beyond the address for property still under construction.

Incidental Personal Property

When a replacement property comes with personal property that is typically transferred with it, such as furniture in an apartment building, you do not need to identify those items separately as long as their combined value does not exceed 15% of the real property’s fair market value.² For a $1,000,000 apartment building, that permits up to $150,000 in furniture, laundry equipment, and similar items to ride along without separate identification. Above the threshold, the personal property has to be identified on its own, and it will not qualify for like-kind treatment because Section 1031 now covers only real property.

Delivering the Form and the 45-Day Deadline

The identification period starts the day you transfer the relinquished property and ends at midnight on the 45th day after that transfer.² Count carefully. If you closed on March 1, your deadline is midnight April 15. There are no extensions for weekends, holidays, or personal hardship. Disaster relief is the only exception, and it has its own requirements (below).

You must deliver the signed identification to one of the following:

The seller of the replacement property, even if that person happens to be a disqualified person.
Any other person involved in the exchange who is not a disqualified person, most commonly your Qualified Intermediary but also an escrow agent or title company.²

A disqualified person is anyone who served as your employee, attorney, accountant, investment banker or broker, or real estate agent within the two years before you transferred the relinquished property.³ Related parties under Sections 267(b) and 707(b), using a 10% ownership threshold instead of the usual 50%, are also disqualified. One exception: a person who provided services only in connection with Section 1031 exchanges, or who performed routine title, escrow, or trust services, is not disqualified even if they otherwise fall into one of those categories.

Acceptable delivery methods include hand delivery, mail, fax, or email. The regulation says “hand delivered, mailed, telecopied, or otherwise sent.”² Whatever route you take, keep proof: a certified mail receipt, a fax confirmation with a timestamp, or an email delivery receipt. If the IRS ever asks whether you met the deadline, that proof is your defense.

Changing or Revoking an Identification

Deals fall through. Inspections turn up problems. You can revoke any or all of your identified properties and submit a revised list, but only before midnight on the 45th day. Once that window closes, your list is locked.²

A valid revocation must be a signed written document delivered to the same person who received the original identification, usually your Qualified Intermediary. If the original identification was part of a written exchange agreement rather than a standalone form, the revocation must be either a written amendment to that agreement or a separate signed document sent to all parties to the agreement. Many QI forms include a checkbox stating that the new form revokes all prior identifications, which meets the requirement if you sign and deliver it before the deadline.

Be explicit about what you are revoking. If you submit a new identification without formally revoking the old one, the IRS may treat both lists as active at the same time. That combined list could push you over the three-property limit or the 200% value cap and void the whole identification. The safer practice is to build the revocation language into every revised form rather than rely on a separate letter.

Disaster-Related Deadline Extensions

The IRS can postpone the 45-day identification period and the 180-day exchange period for taxpayers affected by a federally declared disaster, an act of terrorism, or a military action. The governing framework is Revenue Procedure 2018-58.⁴ Relief is not automatic. The IRS must issue a specific disaster relief notice for the event; a FEMA declaration or presidential declaration alone does not postpone your exchange deadlines.

To qualify, you must be an “affected taxpayer” as defined in the relevant IRS notice, generally someone who lives or has a principal place of business in the designated disaster area. You can also qualify if the replacement property is in the disaster area, if a key party to the transaction (QI, title company, or lender) is located there, or if essential exchange documents were destroyed or inaccessible because of the disaster. When relief applies, deadlines are postponed by 120 days or to the end of the general disaster extension period announced by the IRS, whichever is later. The postponement can never extend beyond your tax return due date (with extensions) or one year, whichever comes first.

What a Failed Identification Costs

If you miss the 45-day deadline, identify properties in a way that violates all three rules, or fail to close on any identified property within the exchange period, the exchange is treated as a taxable sale. The capital gains from the original transfer become immediately taxable, along with any depreciation recapture and applicable state tax. Taxpayers with modified adjusted gross income above $200,000 (single) or $250,000 (married filing jointly) also owe the 3.8% Net Investment Income Tax on the gain.⁵ The stakes are high enough that identification is worth doing early and carefully.

Common Mistakes to Avoid

Most identification failures come down to a handful of preventable errors.

Vague property descriptions. “A property on Main Street” is not unambiguous. Use the full address with city, state, and unit number, or the legal description. When in doubt, include both.
Counting errors under the three-property rule. If you list four properties thinking you revoked one, but the revocation was defective, you have four active identifications and no valid identification at all unless you happen to fall within the 200% rule.
Forgetting the signature. An unsigned form is not valid, regardless of how it was delivered. Electronic signatures are widely accepted, but the document must be clearly attributable to the taxpayer.
Delivering to the wrong person. Sending the form to the accountant or attorney who handled your sale runs into the disqualified-person rule. Deliver to your Qualified Intermediary, the seller of the replacement property, or another non-disqualified party.
Waiting until day 45. Mail delays, fax failures, and email bounces are not excuses the IRS will accept. Build in a buffer. Many experienced exchangers finalize identification by day 40.

Keep copies of everything: the signed form, the transmission confirmation, and any correspondence with your Qualified Intermediary about the identification. If the IRS audits the exchange years later, you will need to prove both what you identified and when you identified it. If your form has a receipt-acknowledgment field for the QI, make sure it gets signed and returned to you.

1
Office of the Law Revision Counsel. 26 USC 1031 – Exchange of Real Property Held for Productive Use in a Trade or Business or for Investment
2
eCFR. 26 CFR 1.1031(k)-1 – Treatment of Deferred Exchanges
3
Federal Register. Definition of Disqualified Person
4
Internal Revenue Service. Revenue Procedure 2018-58
5
Internal Revenue Service. Net Investment Income Tax