We're doing our 3rd 1030 tax exchange.  The first two times were simple; we actually were in escrow before the end of the 45 day period.  Now, with this market, it's different, and we're frustrated.  We've been seeing our realtor every weekend since we closed escrow and everytime we make a bid, two days later, the sale is pending for someone else!  Since the 45 day rule is firm, my guess is, if one of our offers isn't accepted, we're done.  AND, I can't seem to find the answer to this question.....so you identify three properties and notify your exchange company on time.  What if all three properties that you identify get snatched away by another buyer?  Are you done and have to pay capital gains?  We're getting the feeling that maybe this wasn't a good idea at this time with all of the bank forclosures, bidding wars for low-priced housing and short sales.....Discussion?

Yes, you are right on the money.  The 45 day rule is firm and if the three properties that you identified are no longer available you have a failed 1031 exchange and it becomes taxable.  I am assuming that the 180th day falls in 2009, so your taxes would be due for 2009.  It is a challenging time, but there are also tremendous opportunities out there to buy.  It can be stressful, but is also one of the most important buying opportunities of our lifetime.  You might may want to consider finding property that you really want, identifying it, and over bidding to make sure that you get the property.  The amount that you over pay by may be more than offset by the amount of taxes that you save.  It depends on what your tax liability will be.  It also depends on whether you have other losses that could offset this gain.  Does this help?

Dear exchange buyer.......finding properties is a "key" in the process and I assume that you are referring to residential property for your 3 offers. I want to throw out a possibility for your consideration.  Have you considered a commercial or industrial property?   THere are some very good opportunities with less of a risk and many people feel - a better investment than residential because of their radical fluctation in pricing.   Industrial / commercial properties can be rented to businesses and depending on where you are looking, that can be a safer investment than a residence.  Just thought I would mention that idea and I am available to discuss this with you if you are so inclined.  Good luck.....