Fund safety during your 1031 Exchange

If you are planning to do a 1031 Exchange, please make sure to choose a qualified intermediary who provides transparency for the 1031 Exchange funds.

Several qualified intermediaries have gone BK this year due to having invested the exchange funds poorly. Taxpayers lost their nesteggs and still owe the taxes! A good qualified intermediary opens a separate money market account for your exchange and you should receive the monthly statement from the depository bank.In the past, we all looked to make sure a qualified intermediary had a fidelity bond and E&O insurance. Those instruments do nothing to protect from exchange funds being foolishly invested.

You need to be able to monitor your nest egg the entire time it is held by the qualified intermediary. I am only aware of two companies who provide this transparency: Haven Exchange and Exchange Resources. See http://www.havenexchange.com or http://www.exchangeresources.net.