Reference
1031 Exchange Glossary
The vocabulary of a like-kind exchange, defined without circular jargon. Every term here appears somewhere in the 1031 exchange process described across this guide.
The Easy1031 Exchange DeskReviewed September 3, 2026
0–9
- 95% rule
- An identification rule allowing you to name any number of properties at any value, provided you actually acquire at least 95% of the total value you identified.
- 200% rule
- An identification rule allowing you to name any number of replacement properties, provided their combined fair market value does not exceed 200% of what you sold.
A
- Adjusted basis
- What you originally paid for a property, plus capital improvements, minus the depreciation you have claimed. Gain is measured against this figure, not against what you paid.
B
- Boot
- Anything you receive in an exchange that is not like-kind property — usually leftover cash, or a reduction in your debt. Boot is taxable up to the amount of your realized gain.Also called: Cash boot, mortgage boot
C
- Constructive receipt
- Having the money made available to you, even if you never touch it. Constructive receipt of the sale proceeds ends an exchange just as surely as taking the cash.
D
- Delayed exchange
- The standard structure, in which you sell first and buy later within the 45- and 180-day windows. Roughly nine in ten exchanges are delayed exchanges.Also called: Forward exchange, Starker exchange
- Disqualified person
- Someone who may not act as your qualified intermediary — you, your agent, or anyone who has been your employee, attorney, accountant, investment banker or real estate agent within the two years before the transfer.
E
- Exchange Accommodation Titleholder
- A separate entity that holds title to one of the properties during a reverse or improvement exchange, because you cannot hold title to both at once and still qualify.Also called: EAT
F
- Form 8824
- The IRS form on which a like-kind exchange is reported, filed with the return for the year the relinquished property was sold.
I
- Identification period
- The 45 calendar days after your sale closes, during which you must name your replacement property in a signed written notice delivered to your intermediary.
- Improvement exchange
- An exchange in which part of the proceeds is spent constructing or improving the replacement property before you take title, so that its finished value meets the equal-or-greater test.Also called: Construction exchange, build-to-suit exchange
L
- Like-kind
- For real estate, interpreted very broadly: almost any US real property held for investment or business use can be exchanged for almost any other. Raw land for an apartment building is like-kind.
Q
- Qualified intermediary
- The independent third party that holds your sale proceeds between closings and prepares the exchange documents. Required — you cannot hold the funds yourself.Also called: QI, accommodator, exchange facilitator
R
- Relinquished property
- The property you are selling — the one you already own at the start of the exchange.Also called: Downleg
- Replacement property
- The property you are buying with the exchange proceeds.Also called: Upleg
- Reverse exchange
- An exchange in which you acquire the replacement property before selling the relinquished one, with an Exchange Accommodation Titleholder holding title in the interim.
S
- Section 121 exclusion
- The separate rule that lets you exclude gain on the sale of a primary residence. Different from Section 1031, and sometimes relevant to a property that has been both a home and a rental.
T
- Three-property rule
- The most-used identification rule: you may name up to three replacement properties of any value, and buy one, two or all three.
Still have a question about your exchange?
The Easy1031 exchange desk answers these all day, and setting up a standard forward exchange costs nothing.
Easy1031 publishes this guide. It is a qualified intermediary, so it has a commercial interest in you starting an exchange — worth weighing, and worth comparing against other intermediaries before you commit.