A like-kind exchange defers recognition of gain on the disposition of real property held for investment or productive use in a trade or business, where replacement property is acquired.

Real property only. The provision now applies to real property; personal property exchanges no longer qualify.

The deadlines. Replacement property must be identified within forty-five days of transferring the relinquished property, and acquired within one hundred eighty days or the tax return due date, whichever is earlier. These are statutory and are not extended for ordinary hardship.

Identification rules. Up to three properties regardless of value, or any number whose aggregate value does not exceed twice the relinquished property’s value, or any number if ninety-five percent of the identified value is acquired. Identification must be in writing, signed and delivered.

Qualified intermediary. The taxpayer must not receive or control the proceeds. A qualified intermediary holds them under an exchange agreement, and constructive receipt destroys the deferral.

Boot. Cash or other property received, and relief from liabilities not offset, is taxable to the extent of gain.

Reverse and improvement exchanges are possible through parking arrangements with an exchange accommodation titleholder, within safe harbor conditions.

Related party rules impose holding periods and anti-abuse limits that catch family and entity transactions.