Reverse Exchange

Reverse Exchange

Reverse 1031 Exchanges

Section 1031 of the Internal Revenue Code is a useful tax tool that’s available to all U.S. taxpayers. There are several different types of exchanges – all of which can be beneficial in certain situations. One popular type is known as the “Reverse 1031 Exchange.” Read on to learn more about reverse exchanges and how they work.

What is a Reverse 1031 Exchange?

A reverse 1031 exchange accomplishes the same goal as a forward 1031 exchange (capital gains tax referral). The difference between the two is the order in which things happen. In a typical forward exchange, you sell your relinquished property first. Then, you identify and acquire your new replacement property. In a reverse exchange, that process is flipped: (1) you acquire your replacement property, and (2) you sell your relinquished property.

In any 1031 exchange – reverse exchanges included – you need to abide by numerous rules. For example, your property needs to be held for investment or business purposes, and you need to complete your exchange within the 180-day exchange timeline. Because there are so many rules to keep in mind, it’s always a good idea to work with a qualified intermediary on your exchange.

When to Consider a Reverse 1031 Exchange

A reverse exchange can be particularly beneficial in a hot seller’s market, where properties are selling quickly. In this situation, it may be difficult to lock down a replacement property that fits your needs within the allotted 45-day time period. With a reverse exchange, you can acquire your replacement property first, and then sell your relinquished property.

Commercial Partners Exchange Company

Looking to defer capital gains taxes on the sale of real estate? A reverse exchange may be a good option for you. MBL Title has collaborated with Commercial Partners Exchange Company, LLC (“CPEC1031”) to faciliate reverse 1031 exchanges for our clients.

Contact CPEC1031 today for assistance with your next exchange. CPEC1031’s qualified intermediaries have over two decades of experience facilitating exchanges of all shapes and sizes. They can help you through the entire exchange process and answer all of your questions along the way. You can reach CPEC1031 at their primary office in Minneapolis, or at one of their satellite offices around the country.

CPEC1031 Staff

Jeffrey Peterson



Marna Peterson

Vice President


Kent Carlotto

Exchange Officer


Brook Miller

Exchange Coordinator


Lydia Lonnquist

Exchange Assistant


Sytire Williams

Exchange Assistant


Wyn Peterson

Exchange Assistant


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