Property Identification
Comprehensive identification services for replacement properties across all 50 states.
Learn MoreThree Property Rule Strategy
Guidance on identifying up to three replacement properties under IRS rules.
The three property rule allows identification of up to three replacement properties regardless of total value, providing maximum flexibility for investors in Baltimore, MD and nationwide. This rule is one of three identification options available under IRS regulations, and it offers simplicity compared to the 200 percent rule or 95 percent rule. Investors in Baltimore, MD must identify replacement properties within 45 calendar days of closing on their relinquished property, and the three property rule allows identification of up to three properties without value restrictions. We help investors structure identification lists that maximize flexibility while maintaining compliance. Our strategy includes property selection, documentation preparation, and intermediary coordination to ensure your three-property list meets every IRS requirement. We coordinate with qualified intermediaries and qualified escrow agents to ensure identification letters properly document all three properties. The 180-day closing deadline requires efficient strategy execution, and the three property rule provides clear options for replacement property acquisition.
Related Services
Search related services or browse all options below.
200 Percent Rule Strategy
Guidance on identifying multiple replacement properties under the 200 percent value rule.
Learn More45 Day Timeline Management
Deadline tracking and timeline coordination for 1031 exchange identification windows.
Learn MoreBoot Calculation and Planning
Boot analysis and planning to minimize taxable boot
Learn MoreWhat We Include
- Guidance on three property rule strategy and compliance requirements
- Property selection support to maximize flexibility within three property limit
- Identification letter preparation listing up to three properties
- Comparison analysis with 200 percent rule and 95 percent rule strategies
- Coordination with qualified intermediaries and qualified escrow agents
- Documentation support for three property identification
- Boot calculation guidance to minimize taxable boot
- Timeline management during the 45-day identification window
Common Situations
An investor in Baltimore, MD wants to identify three replacement properties under the three property rule but needs guidance on property selection and documentation
A property owner wants to compare the three property rule with the 200 percent rule to determine the best identification strategy
An investor needs to structure three property identification to minimize boot while maximizing flexibility within the 45-day window
Compliance and Limits
A 1031 exchange defers federal income tax on qualifying real property but does not eliminate transfer taxes, recordation taxes, or documentary taxes. In Baltimore, MD, state, county, and municipal transfer and recordation taxes still apply during a 1031 exchange. The three property rule is one of three identification options available under IRS regulations. This information is educational only and does not constitute tax, legal, or investment advice. Consult with qualified tax and legal professionals regarding your specific situation.
Example Capability
Example of the type of engagement we can handle
Service Type: Three Property Rule Strategy
Location: Baltimore, MD
Scope: Provide three property rule strategy guidance and identification letter preparation for a $3.2 million commercial property sale, identifying three replacement properties within the 45-day window
Client Situation: Investor selling a commercial property in Baltimore, MD wants to identify three replacement properties under the three property rule but needs guidance on property selection and documentation
Our Approach: We provided three property rule strategy guidance, sourced three replacement properties across multiple states, prepared identification letter listing all three properties, and coordinated with qualified intermediary for submission
Expected Outcome: Client identified three properties under the three property rule, submitted identification letter before Day 40, and acquired two of the three identified properties within the 180-day deadline
Contact us to discuss your situation in Baltimore, MD. We can share references upon request.
Frequently Asked Questions
What are the three property rule identification requirements in Baltimore, MD?
The three property rule allows identification of up to three replacement properties regardless of total value in Baltimore, MD. Investors must identify properties in writing within 45 calendar days of the relinquished property closing. Each identified property must include a street address or legal description plus purchase price detail. The three property rule provides maximum flexibility compared to the 200 percent rule or 95 percent rule.
How does boot calculation work with the three property rule in Baltimore, MD?
Boot is any non-like-kind property or cash received in a 1031 exchange that creates taxable gain. In Baltimore, MD, receiving cash, debt relief exceeding replacement property debt, or non-qualifying property triggers boot. Under the three property rule, investors can structure property identification to minimize boot by ensuring the combined value of acquired properties equals or exceeds relinquished property value and replacement debt equals or exceeds relinquished debt.
Can I identify fewer than three properties under the three property rule in Baltimore, MD?
Yes, investors in Baltimore, MD can identify one, two, or three properties under the three property rule. The rule allows up to three properties, but there is no minimum requirement. Identifying fewer properties provides more focus but less flexibility if one property becomes unavailable.
How does the three property rule compare to the 200 percent rule in Baltimore, MD?
The three property rule in Baltimore, MD allows identification of up to three properties regardless of value, while the 200 percent rule allows identification of any number of properties if their combined value does not exceed 200 percent of the relinquished property value. The three property rule provides simplicity and certainty, while the 200 percent rule provides more options but requires value calculations.
What happens if I want to acquire only one of the three identified properties in Baltimore, MD?
Under the three property rule in Baltimore, MD, investors can acquire one, two, or all three identified properties. There is no requirement to acquire all identified properties. However, investors must acquire at least one identified property to maintain exchange compliance.
How do I coordinate with a Qualified Intermediary for three property rule identification in Baltimore, MD?
We coordinate with qualified intermediaries in Baltimore, MD to ensure three property rule identification letters meet IRS requirements. The identification letter must list all three properties with street addresses or legal descriptions plus purchase price details. We help investors prepare documentation and coordinate submission before the 45-day deadline.
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