OUR QUALIFIED INTERMEDIARY SERVICES
A Qualified Intermediary (QI) is an essential role in every 1031 exchange. In 1991, the IRC Section 1031 regulations were updated to require the use of an impartial third party to hold funds when conducting the sale and purchase of real estate through a 1031 exchange. Thus, the role of the QI was born.
The Role of the QI
Why do you need a QI?
The key element in a successful exchange is that the taxpayer is not, at any time, in receipt of any portion of the funds from the sale of the relinquished property, otherwise, the exchange fails. The role of the Qualified Intermediary is to ensure the Internal Revenue Code Section 1031 states that "no gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment if such property is exchanged solely for property of like kind which is to be held for productive use in a trade or business or for investment." 1031 Exchange stays within compliance.
In order to do so, the QI holds the funds of the relinquished property and then transfers the funds for the purchase of the replacement property, all parties buy and sell via the QI, so the taxpayers are never in receipt of the funds.
What Does a QI Do?
Per a signed Exchange Agreement the QI conducts the following in relation to a Internal Revenue Code Section 1031 states that "no gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment if such property is exchanged solely for property of like kind which is to be held for productive use in a trade or business or for investment." 1031 Exchange :
- Acquires the relinquished property from the taxpayer and transfers the relinquished property
- Acquires the replacement property and transfer the replacement property to the taxpayer
- Additional responsibilities of the QI include:
- Structures the exchange in accordance with the IRS regulations
- Prepares the related documentation
- Safeguards proceeds from the sale of the relinquished property(s)
- Continuously monitors and advises the taxpayer to ensure compliance with federal and state 1031 and QI requirements
What our customers think about us
Without question the best 1031 exchange company I have ever worked with. Marita is a pro and takes all the guess work out of the process. She has managed four exchanges for me in the past year and will continue to be my agent of choice in the future. No need to search any further!
A great service, performed with expceptional communication. A++
Every person involved in our exchange would hold your hand and walk you through the process if necessary. Great folks. We are already scheduling another exchange. Regards Oswald’s
Marita Kazos has been very responsive and helpful over the last 6 months that I have been working with her. When embarking on any new system it can be intimidating, no matter how much you know the subject matter the software can throw you off of your game. I have been able to reach Marita immediately with any needs I might have. She is always pleasant and never avoids helping. If Marita can't help, because the back end needs to get involved, then she finds the help you need and gets a teammate involved. I enjoy working with Marita and look forward to our future interactions. Thank you Marita - Brigitte
What an interesting class. So much information presented in a digestible way.
Accruit's QI Services
We Handle All Types of 1031 Exchanges, From Simple to Complex
Accruit is the leading independent 1031 Exchange Qualified Intermediary. With a team of 1031 Exchange Subject Matter Experts backed by patented technology, we are proud to offer best-in-class service on all types of 1031 Exchanges including:- Forward Exchanges
- Reverse Exchanges
- Built-to-Suit and Improvement Exchanges
- High-Volume Exchangers
- Multiple Buyers and Sellers
- Fractional Interests, Delaware Statutory Trusts (DSTs) and Tenants in Common (TICs)
- Seller-financed Transactions
- Properties held in Trusts or LLCs
- Multiple Relinquished and Replacement Properties
- Exchanges That Occur In Multiple States
The Accruit Difference
Years of Experience
Qualified Professionals, Attorneys, CPAs, and Certified Exchange Specialists® on Staff
Safety and Security of Exchange Funds
Fidelity Bonding and E&O Insurance
Patented 1031 Exchange Technology
Accruit developed and patented the only Internal Revenue Code Section 1031 states that "no gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment if such property is exchanged solely for property of like kind which is to be held for productive use in a trade or business or for investment." 1031 Exchange workflow technology Exchange Manager ProSM. The transfer of the relinquished property to the Qualified Intermediary, and the receipt of the replacement property from the Qualified Intermediary is considered an exchange. To be compliant with IRC Section 1031, the transaction must be properly structured, rather than being a sale to one party followed by a purchase from another party. Exchange Manager ProSM provides a standardized workflow with automated deadline reminders and document creation increasing efficiencies and reducing the potential for errors throughout the 1031 exchange process.
Dedication to the 1031 Exchange Industry
Regulatory Measures
- Qualified escrow and/or trust accounts for client funds
- Minimum bond and insurance requirements
- Fund withdrawal authorization requirements
- Registration and licensing requirements for QIs
- Investment limitations on exchange proceeds