Qualified intermediary
Also called: QI · exchange intermediary · 1031 intermediary · 1031 accommodator
A commonly used independent facilitator that enters into an exchange agreement and helps structure transfers so the taxpayer does not simply receive the exchange proceeds.
What it means in practice.
A QI generally cannot be the taxpayer or a disqualified person. In a deferred exchange, the QI typically enters into a written agreement with the taxpayer and facilitates transfer of relinquished and replacement property under the regulatory safe harbor.
Why it matters.
Selecting a QI involves operational due diligence as well as tax mechanics: funds controls, banking, cybersecurity, insurance, documentation and experience matter.
Additional notes.
A QI generally cannot be the taxpayer or a disqualified person. In a deferred exchange, the QI typically enters into a written agreement with the taxpayer and facilitates transfer of relinquished and replacement property under the regulatory safe harbor.
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