Why Is a Qualified Intermediary Required in Milligan, FL?
The IRS mandates that a QI hold the proceeds during a 1031 exchange to ensure the taxpayer in Milligan, FL does not take possession of the funds. If the investor touches the money, even temporarily, the exchange is disqualified, and capital gains taxes must be paid.
Who Can Be a Qualified Intermediary in Milligan, FL?
A Qualified Intermediary must be an independent third party. The following cannot serve as a QI:
- The taxpayer (investor)
- A family member or relative
- The investor’s real estate agent, attorney, accountant, or financial advisor (if they provided services in the last two years)
- A business partner or anyone with a financial interest in the transaction