Since 1921, federal tax law under section 1031 of the Internal Revenue Code (IRC) has allowed a taxpayer to exchange assets or real estate for other similar assets or real estate without recognizing taxable profits from the sale of the old assets. Taxes that would otherwise have been due from the sale are therefore deferred. Most 1031 exchanges involve separate buyers and sellers and are not simply exchanges between two parties. In these circumstances, the use of a Qualified Intermediary (QI) independent of a third party is required to fulfill the “exchange” requirement. The QI retains the proceeds of the sale for the benefit of the taxpayer during the exchange, pays the funds for the purchase of replacement properties of the same type, and returns the unused funds to the taxpayer upon completion of the exchange. 1031 The exchange must be completed within 180 days. Taxpayers record profits and taxes on unused funds or when they eventually “pay off” their property. In 2018, section 1031 was changed to include only properties for a 1031 exchange.