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Types Of
Exchanges
There are
several types or variations of exchanges. The most
common type of exchange is the delayed or forward
exchange. In a forward exchange, a taxpayer sells
the property currently owned (relinquished property) and
acquires new property (replacement property).
However,
it may be necessary to acquire replacement property
before the currently owned (relinquished property) can
be sold. An exchange structured to allow this is
known as a reverse exchange.
A
property owner may also desire to construct improvements
on property to be acquired in an exchange. An
exchange structured to allow this is called a
"construction exchange".
A
simultaneous exchange anticipates an actual simultaneous
exchange of property between parties.
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