Is Your 1031 Exchange at Risk? 3 Timeline Mistakes to Avoid

Navigating a 1031 exchange timeline can feel like a race against the clock. With just 45 days to identify replacement properties and 180 days to close, one missed deadline could mean losing your tax-deferral benefits—and facing a hefty capital gains tax bill.

In this post, we’ll break down the most common 1031 exchange timeline mistakes that trip up investors—and how to avoid them.

Whether you're just starting the exchange process or in the middle of it, understanding these critical errors can protect your investment.

Mistake #1: Thinking the Timeline Starts When You Find a Buyer

One of the most common misunderstandings is assuming the 1031 exchange timeline begins when you go under contract—or when you "start looking."

Reality check: The 1031 timeline officially begins the day you close on your relinquished (sold) property. That day is considered Day 0, and from there, the IRS gives you:

• 45 calendar days to identify replacement properties

• 180 calendar days to complete the purchase of one or more of those properties

Tip: You must have a Qualified Intermediary (QI) in place before the sale closes, or the exchange will be disqualified.

Mistake #2: Submitting a Vague or Invalid Property Identification

During the 45-day window, the IRS requires you to formally identify replacement properties in writing—typically to your QI.

But here’s the catch: If your identification is too vague, incomplete, or doesn't follow one of the IRS’s approved rules (such as the 3-property rule), it can be deemed invalid.

Examples of invalid identification:

• “Any duplex in San Diego”

• “A commercial building TBD”

• Listing more than 3 properties without following the 200% or 95% rules

An incomplete identification means you’ll have no valid properties to close on—resulting in a failed exchange.

Tip: Identify specific properties by address or parcel number, and confirm your list meets the IRS criteria.

Mistake #3: Forgetting the Tax Return Deadline Override

Even if your 180-day closing window extends past tax season, the IRS still requires that the exchange is completed before your return is filed—unless you file an extension.

Let’s say you close on your relinquished property in December. Technically, your 180-day deadline might fall in June of the following year. But if you file your tax return in April, the exchange would be cut off early unless you’ve filed an extension.

Tip: Work with your CPA and QI to align your 1031 exchange timeline with your tax filing plans.

Recap: The 1031 Exchange Timeline in Brief

Here’s a quick overview to keep you on track:

Timeline Step	Deadline	Common Pitfall
Close on sold property	Day 0	No QI in place
Identify replacements	Day 45	Vague/incomplete list
Close on replacements	Day 180 (or tax return due date, whichever is earlier)	No extension filed

Avoid Timeline Mistakes with the Right Experts

Timing is everything when it comes to a successful 1031 exchange. These timeline mistakes are easy to make—but also easy to avoid with the right support.

At APX 1031, we guide investors through every step of the process, ensuring you never miss a deadline or overlook a detail.

Curious to learn more and estimate your deadlines? Use our 1031 Exchange Timeline Calculator to plan your timeline. Ready to take it one step further? Get in touch, we're ready to help you simplify your exchange.