How a Reverse Exchange Works
You acquire replacement property before your current property sells.
What Makes a Reverse Exchange Different
In a typical exchange, you sell first and buy later. In a reverse exchange, you acquire the replacement property before your relinquished property sells. This reverses the usual order and needs close coordination from your intermediary from the start.
More Moving Parts, More Coordination
Because two properties may be involved at once, a reverse exchange adds coordination points: title work, financing on the new property, and possibly holding costs. Your intermediary, CPA, and attorney need to align before you make an offer.
Confirm Structure With Your Advisors
There is more than one way to structure a reverse exchange, and the right one depends on your financing and goals. I handle the real estate side: finding the property, underwriting it, and coordinating closing. Confirm the legal and tax structure with your CPA, attorney, and intermediary before you act.
Sources
Educational only, not tax advice. Your CPA must confirm tax treatment, timing, participation, basis, and filing before you act.
Common questions
Clear answers first. If one question changes the deal, bring it into the review before you move money.
Q1What is a reverse 1031 exchange?+
It is an exchange where you acquire your replacement property before your current property sells, instead of after. It needs close coordination with your intermediary from the start. Confirm eligibility and structure with your CPA, attorney, and intermediary before you commit to a purchase.
Q2Does a reverse exchange involve more cost categories?+
It typically does, including additional title, escrow, and financing work, because two properties may be involved at once. Exact costs vary by provider and deal. Ask every provider for a written breakdown before you proceed.
Q3Who decides the legal structure of a reverse exchange?+
Your CPA, attorney, and intermediary decide the structure based on your deal. I coordinate the real estate side, including property search, underwriting, and offer strategy, but structure and tax decisions are not mine to make.
Considering a Reverse Exchange?
Book a Real Estate Review so we can map your property search and timeline, then confirm the exchange structure with your CPA, attorney, and intermediary before you make an offer.
Considering a Reverse Exchange?
Book a Real Estate Review so we can map your property search and timeline, then confirm the exchange structure with your CPA, attorney, and intermediary before you make an offer.
Book a Real Estate ReviewNext steps
Keep moving forward
Exchange Your Investment Property Without Losing Your Timeline
Plan a 1031 exchange in Seattle, Bellevue, or Kirkland. We handle sale timing, replacement property search, and closing while your CPA confirms tax treatment.
View next stepWhat a Qualified Intermediary Does in an Exchange
Learn what a 1031 exchange qualified intermediary does, when to sign, and what to ask before you close on your Seattle or Bellevue property.
View next stepCompare Like Kind Exchange Companies With Confidence
Compare 1031 exchange companies on Washington bonding rules, written disclosure, and total cost before you pick a qualified intermediary for your exchange.
View next step