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subsection, any property received by the taxpayer shall
be treated as property which is not like-kind property
if--
(A) such property is not identified as
property to be received in the exchange on or
before the day which is 45 days after the date on
which the taxpayer transfers the property
relinquished in the exchange, or
(B) such property is received after the
earlier of--
(i) the day which is 180 days after the
date on which the taxpayer transfers the
property relinquished in the exchange, or
(ii) the due date (determined with
regard to extension) for the transferor’s
return of the tax imposed by this chapter for
the taxable year in which the transfer of the
relinquished property occurs.
Although the transactions in issue are deferred like-kind
exchanges the tax consequences of which are governed by section
1031(a)(3), we precede our consideration of the statute by
looking to certain pre-DEFRA case law that continues to be
generally applicable to like-kind exchanges. In structuring
their transactions as tax-deferred like-kind exchanges, taxpayers
have been allowed great latitude. Biggs v. Commissioner, 69 T.C.
905, 913 (1978), affd. 632 F.2d 1171 (5th Cir. 1980). For
instance, an agreement to sell property for cash may be converted
into a like-kind exchange before substantial implementation of
the transaction occurs. Coupe v. Commissioner, 52 T.C. 394, 405
(1969). Multiple parties may be involved in an exchange where
the potential buyer of the taxpayer’s property does not own any
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Last modified: May 25, 2011