The 45-Day Period is a critical part of the process. This period refers to the time frame in which the investor, after selling the original (relinquished) property, must identify the potential replacement properties they plan to purchase.

This period begins on the day the investor sells their original property and ends exactly 45 days later, regardless of whether these days are weekends or holidays. This deadline is strictly enforced, and missing it could potentially disqualify the entire 1031 exchange process, resulting in significant tax liabilities.

It’s also important to note that there are specific rules around the number and value of properties that can be identified during this period. These are often referred to as the “3-property rule,” the “200% rule,” and the “95% rule.” The 45-Day Period is a crucial part of structuring a successful 1031 exchange.