95% rule
Also called: 95 percent rule · ninety-five percent rule
A narrow rule that may preserve an identification when too many properties were identified, if enough of the identified value is actually received.
What it means in practice.
Under the regulatory framework, where identification exceeds the normal limits, the identification can still be respected in certain circumstances if the taxpayer receives identified replacement property worth at least 95% of the aggregate value of all identified property before the exchange period ends.
Why it matters.
It is not a casual workaround; it is a demanding threshold and should be used only with professional guidance.
Additional notes.
Under the regulatory framework, where identification exceeds the normal limits, the identification can still be respected in certain circumstances if the taxpayer receives identified replacement property worth at least 95% of the aggregate value of all identified property before the exchange period ends.
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