Property owners in Oregon who wish to defer capital gains taxes on the sale of property may be able to do so by entering into a Section 1031 Exchange agreement instead of completing a traditional sale under the rules of the Internal Revenue Service. In an effort to ensure that 1031 Exchanges comply with the complex, and ever changing, rules, as well as to safeguard funds and ownership documents during an exchange, participants in a 1031 Exchange are required to use a Qualified Intermediary, or QI, to complete the transaction.
The role of the QI is one of a facilitator, meaning that the QI takes possession of titles and funds and distributes them to the appropriate parties at the appropriate time. Because a QI acts in a fiduciary role, many individual states have passed legislation in addition to that found under the federal rules that further dictates the duties and responsibilities of a QI. Oregon is one of those states; however, in Oregon a Qualified Intermediary is referred to as an Exchange Facilitator, or EF. Your EF will be your guide to ensure all rules and requirements of a 1031 exchange are followed.
