Answer
Apr 17, 2025 - 12:38 PM
I don't know what the rate is, but for a long time, exchanges did not have a lot of... did not create a lot of audits. But the problem is that people trigger audits with other things, and then they find things, in the 1031 exchange space. But in the circles I've talked to, they're saying that they're starting to see more audits in the 1031 space. And so... here is that if you do an exchange, hold that for at least two years. And that's not even a written rule. And so some of these rules that the IRS applies is not even written in the tax code. But that third tolerance is two years. You can hold, if you want to buy a future primary residence to an exchange, you exchange it into a property, hold it for two years before you move in. And you can do that. So, but in terms of the audit percentages, I don't know anybody that's been audited for a 1031 exchange that that sort of triggered it. But I'm hearing from exchange people that they're starting to see more.
